McClellan Oscillator Metals Analysis & McClellan Oscillator Trading Signals

Developed by McClellan.

The McClellan Oscillator is an indicator that is based on smoothing the difference between the number of bullish candles and bearish candles. This metals technical indicator looks similar to the traditional MACD.

McClellan Oscillator

Metal Analysis & How to Generate Trading Signals

This Oscillator is a momentum indicator that can be traded in the same way as the MACD indicator. There are 3 techniques that McClellan Oscillator can be used to generate trade signals.

Zero Center Line Crossover Signals:

Bullish Signals- When the oscillator crosses above zero center-line a buy metals trade signal is given.

Bearish Signals- When the oscillator crosses below zero center-line a sell metals trade signal is given.

Technical Analysis in Metals Trading

Divergence Metal Trading Signals:

Looking for divergences between the McClellan Oscillator and metals price can prove to be very effective in identifying potential reversal &/or metals trend continuation points in metals price movement.

There are several types of divergences:

Classic Metal Trading Divergence (Regular Metal Trading Divergence)

• Bullish Divergence: Lower lows in metals price action and higher lows in the McClellan Oscillator.

• Bearish Divergence: Higher highs in metals price and lower highs in the McClellan Oscillator.

Hidden Metal Trading Divergence Setup

• Bullish Divergence: Higher lows in metals price action and lower lows in McClellan Oscillator.

• Bearish Divergence: Lower highs in metals price action and higher highs in McClellan Oscillator.

Overbought/Oversold Levels on Technical Indicator

The McClellan Oscillator is also used to identify potential overbought and oversold levels in metals price action movements. The overbought and oversold conditions are generated when the oscillator moves to extreme levels on one side and starts to turn, however, in a strong trending market the oscillator will stay in the overbought and oversold levels for a long time. It is not recommended to trade overbought and oversold levels to generate metal signals. Best signal to use is the Center-line cross-over signals to generate trade signals.