This video explains each Indicator separately. For how the indicators work together in a strategy go to the "My Trendfollowing Approach Explained" video here [ Ссылка ]

Parameters of the Indicators:

Balance Zone:
The blue line (Alligator's Jaw) is the Balance Line for the timeframe that was used to build the chart (13-period Smoothed Moving Average, moved into the future by 8 bars);
Red Line (Alligator's Teeth) is the Balance Line for the value timeframe of one level lower (8-period Smoothed Moving Average, moved by 5 bars into the future);
Green Line (Alligator's Lips) is the Balance Line for the value timeframe, one more level lower (5-period Smoothed Moving Average, moved by 3 bars into the future).
MEDIAN PRICE = (HIGH + LOW) / 2
ALLIGATORS JAW = SMMA (MEDIAN PRICE, 13, 8)
ALLIGATORS TEETH = SMMA (MEDIAN PRICE, 8, 5)
ALLIGATORS LIPS = SMMA (MEDIAN PRICE, 5, 3)

AO:
AO is a 34-period simple moving average, plotted through the central points of the bars (H+L)/2, and subtracted from the 5-period simple moving average, graphed across the central points of the bars (H+L)/2.
MEDIAN PRICE = (HIGH + LOW) / 2
AO = SMA (MEDIAN PRICE, 5) - SMA (MEDIAN PRICE, 34)

Fractals:
Up Fractal: Minimum of 5 bars in a sequence where middle bar has highest high, 2 bars left and 2 bars right have lower highs, vice versa for Down Fractal
Signifies change in desicion, market changes direction at least for the short term.

Bill Williams video, background explanation of Indicators:
[ Ссылка ]

Indicators are the property of © Profitunity

[ #Trendfollowing #Risk Management #Trading Psychology #Systemtrading #Balance Lines #Fractal ] Weekly Recaps on all Major Markets looking for those big trends: Currencies, Global Indices, Metals for long-term Traders and Investors. Visit my website for Explanation on Trading Strategy, Risk Management and Psychological Factors.

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