Average Sentiment Oscillator

Average Sentiment Oscillator displays the depth of market volatility and the strength/weakness of the currencies. This indicator allows traders to understand the status of the market trend and its level of stability so that they can project the possible destination of a price movement. Besides, it also keeps you aware of the sidelined market so that you can avoid bad trades over short momentums.

Average Sentiment Oscillator is a short-term indicator and works better when used for the scalping purposes only within the shorter timeframe charts of MT4 platforms. Other than that, you’re free to apply it to trade any forex currency pairs you like in the market.

Average Sentiment Oscillator Overview

Download and install the indicator on your MT4 terminal. Once you’re done, your chart will transform like the following image:

Average Sentiment Oscillator Overview

Average Sentiment Oscillator Explanation

Average Sentiment Oscillator has been built with a combination of bulls and bears power along with a 10-day ASO Moving Average. Its blue curve moves above the red curve when the momentum is bullish and turns opposite when the momentum switches into bearish.

Average Sentiment Oscillator Explanation

The difference between the curves gets wider when the momentum gets stronger. Both curves get closer to the zero levels when the trend is in a neutral condition signaling a “no-trade” situation.

This oscillator also plays an assisting role in defining the proper trend condition when added to other trend-following strategies.

Average Sentiment: Buy Conditions

Average Sentiment Buy Parameters
  • The indicator curves plot a bullish crossover
  • The distance between the curves get wider
  • Price bar closes as a solid bullish candle at the same time
  • Buy triggers when the above conditions are met
  • Set stop loss below the low of the respective bullish candle
  • Exit long/take profit whenever the indicator plots an opposite crossover

Also Read: RoboForex Broker Review

Average Sentiment: Sell Conditions

Average Sentiment Sell Parameters
  • The indicator curves plot a bearish crossover
  • The distance between the curves get wider
  • Price bar closes as a solid bearish candle at the same time
  • Sell triggers when the above conditions are met
  • Set stop loss above the high of the respective bearish candle
  • Exit short/take profit whenever the indicator plots an opposite crossover
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I have been actively trading stocks and currencies since April 2012. Besides trading with my personal money I am a technical analyst in a mutual fund which has Rs. 1 billion in assets under management. At my leisure, I love attending live music, traveling, and partying with friends.

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