McClellan Oscillator Bitcoin Trading Analysis and McClellan Oscillator Bitcoin Trading Signals

Developed by McClellan.

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

McClellan Oscillator

Bitcoin Trading Analysis and Generating Bitcoin 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 cryptocurrency signals.

Zero Center Line Crossover Signals:

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

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

Technical Analysis

Divergence Bitcoin Trading Signals:

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

There are several types of divergences:

Classic Divergence (Regular Divergence)

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

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

Hidden Divergence

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

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

Overbought/Oversold Levels

The McClellan Oscillator is also used to identify potential overbought and oversold levels in btcusd 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 cryptocurrency trading signals. The best signal to use is the Center-line crossover signals to generate cryptocurrency signals.