ULTOSC (Ultimate Oscillator)

Indicator Description

ULTOSC (Ultimate Oscillator) is a momentum indicator that measures the strength of price momentum by calculating a weighted average of price momentum over three different time periods, helping to reduce false signals.

Function Information

  • Function Name: ULTOSC
  • Input Parameters:
    • High: High price
    • Low: Low price
    • Close: Closing price
  • Parameter Settings:
    • timeperiod1: First period, default 7
    • timeperiod2: Second period, default 14
    • timeperiod3: Third period, default 28
  • Output: ULTOSC value

Calculation Principle

ULTOSC is calculated using the following formula:

BP = Close - min(Low, Prior Close)
TR = max(High, Prior Close) - min(Low, Prior Close)
Average7 = Sum7(BP) / Sum7(TR)
Average14 = Sum14(BP) / Sum14(TR)
Average28 = Sum28(BP) / Sum28(TR)
ULTOSC = 100 * ((4 * Average7) + (2 * Average14) + Average28) / (4 + 2 + 1)

Where:

  • BP is Buying Pressure
  • TR is True Range
  • Sum7/14/28 is the sum over 7/14/28 periods

Usage Scenarios

  1. Overbought/Oversold Analysis
  2. Trend Confirmation
  3. Trading Signal Generation
  4. Divergence Analysis

Usage Recommendations

  1. ULTOSC > 70 indicates overbought conditions
  2. ULTOSC < 30 indicates oversold conditions
  3. Watch for 50-line crossovers
  4. Pay attention to divergence patterns
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