Alligator indicator was introduced by Bill Williams. Its components are three lines, drawn on a pricing chart, which represent the jaw, the teeth and the lips of the alligator, it is good for trend recognition and trading signals. I sometimes use it to recognise the wave formations.
When the three lines are close to each other, then the Alligator’s mouth is closed and she is sleeping. When the trend takes shape, the gap between the lines get bigger and the Alligator wakes up and starts eating profits.
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