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How to Trade effectively with Williams alligator strategy?

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Hello…How are you?

Well, today I am going to talk about one of the most powerful trading strategy i.e Williams alligator strategy.

What is the Williams alligator indicator?

Williams alligator indicator is one of the most powerful and accurate Indicators that I have seen.

This Indicator was developed by the great Bill Williams in 1995.

The main aim of this indicator was to find the trend using the three moving average spinning lines.

According to Bill’s research, he found that the market is just like Alligator.

If you know a little about Alligator, The Alligator spends 70 – 85% of his time sleeping similarly, according to Bill, the market also sleeps 70 – 85% of the time. and the rest 15 – 30%. the market is active.

Williams alligator indicator setting

Here, to illustrate the Williams alligator indicator I am going to use Olymp Trade.

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Once you signed up, you will land on the Olymp Trade dashboard.

 

 

Now, click on the chart button and select Japanese Candlestick from the menu.

Suggested Read: Cheatsheet to Read Candlestick easily

Now, click on the indicator button and select Alligator from the menu.

Lastly, click on the pencil icon and darken the lines for more clarity.

That’s it the basic setup is over!!

Now, talking Williams alligator settings.

According to the experts, The Williams alligator indicator works best at the default settings.

However, talking about the lines The green line is the Alligator lips this is also the fastest line made of a 5-period simple moving average and smoothed by 3 bars.

The red line is Alligator’s teeth which are made of 8-period simple moving average and smoothed by 5 bars.

Similarly, The blue line is the alligator’s jaw and also the slowest line made of 13 moving average and smoothed by 8 bars.

 

Williams alligator Strategy

Well, understanding Williams alligator Strategy is damn very easy.

The golden rule of Williams alligator Strategy says,

If the three intersects each other and there is a huge difference between these lines plus the green line or lips is the above all then we can say that the market is in an uptrend.

Here, we should go for BUY Trade.

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Similarly, If the three intersects each other and there is a huge difference between these lines plus the greenline or lips is below all then we can say the market is in a downtrend.

Here, we should go for SELL Trade.

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However, according to my experience, the Alligator strategy is one of the most powerful indicators However, If you use it with Support and Resistance. It becomes even more powerful.

Suggested: How to draw support and resistance lines and win big with it?

Example:

Look at the chart above we can clearly say at point number 1 and 2 is bearish as the three intersects each other and there is a huge difference between these lines plus the greenline or lips is below the two.

At point number 1, we shouldn’t take any trade as the three lines are close to each other and it suggests that the market is sleeping.

At point number 2, The market is perfect bearish plus the candles are below the resistance level so here, we can place a SELL trade.

At point number 3,  the three intersects each other and there is a huge difference between these lines plus the green line or lips are above all then we can say that the market is in an uptrend plus the line is above the support level so, here we can place a BUY trade.

Winding Up:

So, this is the end of this article. I hope you have found this article helpful.

If you still have any problems you can comment below or mail us at honestdigitalreview@gmail.com.

 

 

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