Blockchain and Cryptocurrency Intermediate - How the Alligator Indicator Can Be Used to Understand Sell / Buy Signals

How the Alligator indicator can be used to understand sell / buy signals

One of the main benefits of the Alligator indicator is that it is a powerful indicator that is provides traders with good buy and sell signals and helps traders know when to entry or exit.

The early formation and position of the Jaw, teeth and the Lips moving average lines is a great way to show buy and sell signals. The early positions when the Alligator is awake is a great signal for buy or sell.

For Buy signal, When the Lips (green line) crosses above the Jaw and the teeth and is at the top, the Jaw (blue line) is at the bottom and the teeth (red line) is at the middle, and the price is above the 3 moving average lines, it can be a signal that the trend is about to be bullish or there is a potential uptrend coming. This can be a good early buy signal.

BNB/USDT Chart

For Sell signal, when the Jaw (blue line) crosses above the Lips and the teeth and is at the top, the Lips (green line) is at the bottom and the teeth (red line) is at the middle, and the price is below the 3 moving average lines, it can be a signal that the trend is about to be bearish or there is a potential downtrend coming. This can be a good early sell signal. Traders can make use of the positions of the Jaw and Lips lines to either place in a buy or sell trade.

The effectiveness of using the Alligator indicator in scalping trading style

Yes, the Alligator indicator has proven to be an effective technical indicator for scalping trading. Scalping trading is basically the type of trading where a scalp trader carries out many trades in a day, this is mostly done on very short timeframes. Scalp traders aims to make small profits from each scalping trade and the multiple quantity of scalp trading a day combines to make up good profits. On the shorter timeframe, the Alligator can produce many buy and sell signals, this is effective for scalping trading. On the SOL/USDT chart using the 1 minute timeframe, we can see the different buy and sell signals generated.

SOL/USDT Chart