The Awesome Oscillator Divergence Indicator (AO Divergence) is an advanced version of the Awesome Oscillator that automatically identifies both positive and negative divergences on the chart.
This tool analyzes the difference between the 5-period and 34-period moving averages, assessing the strength of the trend and its potential changes, and displays it as a histogram.
Awesome Oscillator Divergence Indicator Specifications
The features of this indicator are summarized in the table below:
| Category | Oscillator – Signal and Forecast – Trading Tool |
| Platform | MetaTrader 4 |
| Skill Level | Intermediate |
| Indicator Type | Continuation – Reversal – Leading |
| Timeframe | Multi-Timeframe |
| Trading Style | Day Trading |
| Market | All Markets |
Indicator in an Uptrend
In the AUD/NZD uptrend, after detecting a positive divergence between the AO histogram and the price, the indicator issues a buy signal.
Traders can take profit when the histogram bars enter the positive zone and the volume increases.
Indicator in a Downtrend
In the AUD/JPY price chart, the decrease in the volume of histogram bars along with the identification of a bearish divergence by the oscillator indicates a decrease in the upward trend strength and a potential price reversal. In this case, the indicator displays a sell signal.
Awesome Oscillator Divergence Indicator Settings
The settings for this Awesome Oscillator Divergence Indicator are displayed in the image below:
- Number of candles for Pivots calculation: Number of candles used for pivot calculation
- Maximum distance between two pivots: Maximum distance between two pivots
- Minimum distance between two pivots: Minimum distance between two pivots
- Number of divergences from pivot: Number of divergences from the pivot
- Number of CCI that break the line: Number of CCI breaks
- Shift: Price shift
- Sell Divergence: Color for sell divergence signal
- Buy Divergence: Color for buy divergence signal
- Width: Line thickness
Conclusion
The Awesome Oscillator Divergence Oscillator identifies market trend reversal zones by analyzing bullish and bearish divergences.
This MetaTrader 4 oscillator, by processing Awesome Oscillator data, provides information about trend strength changes and market volatility, displaying key price points.
What is the purpose of the AO Divergence Indicator in MetaTrader 4?
This indicator automatically detects bullish and bearish divergences and marks potential trend reversal areas.
Is the AO Divergence Indicator suitable for all timeframes?
Yes, this indicator is effective in all timeframes, from 1-minute to monthly charts.