The oscillation detector is an indicator that measures the volume in a trend and paints the numbers near the bars on the main part of the chart. It is used much like VAD A is used. The volume in the oscillation detector (OD) measures it a bit differently than the VAD does, therefore the results will not be the same. The oscillation detector ignores single bar elevators in its trend measurement and measures from the lowest low point to the highest high point of that trend. The OD paints a trend line to show you where it is measuring from. If there are two or more bars, the trend count restarts. When chop occurs, the OD will stop painting numbers real time until it knows if the trend has changed or not. If the numbers are not printing, it is reasonable to assume you are in chop or a trend change. Therefore, this indicator is not intended, nor does it help much in reading chop, but it is very helpful for seeing power plays 1, 2 and 3. By not printing in chop until the trend is determined, we do not see any repainting (seeing it one way live and different historically) which usually happens with trend volume measuring indicators. You can watch the numbers build real time unless there is chop or a trend change.
The oscillation detector has alerts that can be turned on for double tops and double bottoms to help give a heads up for power plays. The alert goes off once the price goes into a double top/bottom “zone.” In other words, the alert is triggered just a bit before it becomes a true double top or double bottom. It gives you a bit of time to react and see if all your other components for a power play are in place if one should set up.
The colors of the numbers on the indicator have meaning. A gold color number means the price is inside the zone deemed a double top or double bottom. The indicator is defaulted to print a blue number (white on SEES chart) when the price make a higher high or lower low than it previously did. A black number is the default color that is printed when the number is just a number, not higher price being hit, but instead the price made a lower high price. Conversely when the market is in a down trend, the grey prints when the price has hit a higher low price, not a lower low price.
Numbers can make it easier to read sometimes, but how does this apply to power plays?
Sometimes a trend is broken up by elevators which restart the trend count. It can be hard to tell if you are really getting a good count on a volume. That is when the oscillation detector clear up the picture for you.
