Chaikin oscillator

chaikin oscillator

✔️ Information reviewed and updated in July 2024 by Eduardo López

The Oscillator shows, through movement, changes in asset prices or in the behavior of trends. These types of indicators tend to be widely used because, by their nature, they are easy to interpret. That is why experts recommend taking them into account.

Among the different types of oscillators that we can find, we have the Chaikin oscillator, an indicator that might be unknown to some, but that is actually very useful. Next, we will tell you what this oscillator consists of so that you can know it and take full advantage of it when investing.

➡✨ How is it calculated?

The Chaikin indicator is calculated using the exponential moving average of x periods of the accumulation / distribution line. From this, the exponential moving average of Y periods of the same accumulation and distribution line is subtracted. Generally, the value of X is used as 10 and that of Y as 3.

Calculating it seems a bit complex, which is why most trading platforms offer this type of calculation automatically. Thus, they will save you all this work of doing math and obtaining data.


➡✨ What is the Chaikin indicator for?

This indicator can show us the trend in price changes, for example, showing when a trend is going to end. It is also used to determine price divergences, which is an indication that prices will reverse in the near future.

Like other oscillators, the Chaikin oscillator indicator is a good way to determine if prices are about to change according to the behavior of their highs and lows. Thus, we can be ready and prepare for changes in trends which is useful for buying, selling or holding positions.

➡✨ How can we use the Chaikin Oscillator?

You can use this indicator to know if a price change will come. For example, if there is a bearish divergence, this means that the indicator will mark a downward change. This happens when the curve reaches a price high, but the Chaikin oscillator remains below its high.

The same happens with prices and uptrends, since here, this occurs when the curve reaches the minimum of prices, but the oscillator remains below its previous minimum. As you can see, understanding this indicator is really simple.


Eduardo Lopez

Editor and Copywriter

I am Eduardo López Martínez, I was born in Madrid, Spain and I am 48 years old. I am a journalist and I am part of the team. Do you want to know a little more about me? I invite you to read my biography.

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