|
 |
Technical Analysis, Studies, Indicators:
McClellan
Oscillator
Back to the List of
Studies
McClellan oscillator has been developed by
Sherman and Marian McClellan. McClellan oscillator is a breadth indicator and is
based on the advancing and declining issues.
McClellan oscillator is calculated as a difference between the fast (shorter
moving average) and the slow (longer moving average) exponential moving averages
applied to the net advances.
The
formula to calculate the oscillator:
McClellan Oscillator = (EMA1 of
[(Advancing Issues - Declining Issues)/total Issues] - EMA2 of [(Advancing
Issues - Declining Issues)/total issues]) * 1000
To simplify the calculation the formula could
be split into 5 steps:
- Calculate (Advances - Declines) / Total
- Calculate fast exponential moving average (EMA1) of what you receive
from #1
- Calculate slow exponential moving average (EMA2) of what you receive
from #1
- #3 result subtract from #4 result
- Multiply by 1000 (to work with whole numbers)
The McClellan Volume Oscillator calculation
is similar with the difference that they are based in the
advance-decline
volume.
When the fast EMA moves above
the slow EMA we have positive McClellan oscillator and it indicates that the
advancing issues are dominant on the market. Conversely, when the fast EMA drops
below the slow EMA we have negative McClellan oscillator and it indicates that
the declining issues are dominant.
The McClellan Oscillator reflects positive
and negative changes in the Advance-Declines statistics which could be used in
the to anticipate the trend reversal.
High positive McClellan oscillator indicates
overbought market while the low negative levels indicate that the market is
oversold. As a rule (the same as with the SBV Oscillator), sell signals are
generated when the McClellan oscillator declines from overbought (high positive
levels) towards negative territory. Conversely, buy signals are generated when
the oscillator moves up from the low negative levels (oversold levels) in the
direction of the positive territory.
Chart 1: McClellan Oscillator and S&P 500
Start using our Professional Charts
and Make Money with our System!
Sign up for a 30-Day Free Trial Now!
(credit card not required)
|
Technical studies classified by the types of technical analysis |
MV Studies
- list of technical indicators (studies) developed MarketVolume® team. We are
the first who introduced this indicators to the world and at the current moment
we are the only company that provides these indicators and we consider ourselves
these indicator developers.
Price Studies - information
about calculation and using RSI, Stochastics, MACD, and other
price based technical indicators (studies) which are available with our charts.
Volume Studies - a list of
volume based technical indicators (studies) which are available with our charts.
Advance/Decline Studies
- list of advance decline based technical indicators (studies) which are
available with our charts
Volatility Studies - a
list of technical indicators (studies) which are used to measure market and
security volatility and are available with our charts. |
| |
|
Bookmark this
