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Bill Williams has developed multiple masterpiece indicators and one of them is Alligator Indicator or you can call it Bill Williams Alligator Indicator. You can easily find and use this indicator on IQ Option trading platform. This indicator is free to use so, you can even try this indicator on the IQ Option demo account for free.
Understanding Alligator Indicator on IQ Option
Trading in the financial market can be both exciting and challenging. To analyse the volatile nature of the market you need a good indicator which can help you understand the movement of security properly and make informed decisions about the upcoming trends and reversals. The Alligator Indicator is one such indicator via which you find the best possible entry and exit points. This indicator was developed by Bill Williams. After years of research and development, he found that the market activity is very much similar to an Alligator activity. Just like an Alligator, The market loves to sleep a lot and rest 20 -30 % of the time market is active. Bill Williams believes that this 20 -30% is the best opportunity for traders to find the best buy and sell opportunities.
Unboxing Alligator Indicator
To unbox Alligator Indicator you need to be a member of the IQ Option trading platform. In case you are not click here. Once, you have got access to your IQ Option account. click on the indicator button and select the name Alligator Indicator from the popular section.
Once you click the name. You will see the main components of the indicator like Teeth, Jaw & Lips. These three lines are the moving average line that oscillates around the indicator and the moment they intersect each other is the moment they generate buy and sell signals. The default configuration for the Alligator Indicator is as follows
Jaw: 14-period moving average with 8-period shift
Teeth: 8-period moving average with 5-period shift
Lips: 5-period moving average with 3-period shift
How to use Alligator Indicator on IQ Option?
Identify the market trends: You can identify the presence and absence of trends using this indicator. When the three moving average lines are very closely packed to each other it signals an absence of a trend or you can say that the Alligator is currently sleeping. vice versa, when you see a big gap between these three moving averages it signals the market is active or the awakening of Alligator.
Crossover: When the three moving average lines intersect each other it signals potential buying and selling opportunities. For example, when the Teeth line (Orange Line) intersects above the Jaw line (Red Line) it signals a potential bullish trend and vice versa, when the Teeth intersects below the Jaw line it signals a potential bearish trend.
Breakout: When the price breakouts from the Alligator’s mouth. The Alligator mouth is the space between the Lips, teeth and Jaw. When the price breaks above the upper line i.e Lips of Alligator Indicator it signals a potential Bullish trend and here, you can consider placing a buy trade and vice versa, When the price breaks below the upper line i.e Lips of Alligator Indicator it signals a potential Bearish trend.
