Ultimate Oscillator Developed by Larry Williams and first described in a 1985 article for Technical Analysis of Stocks and Commodities magazine, the "Ultimate" Oscillator combines a stock's price action during three different time frames into one bounded oscillator. Values range from 0 to 100 with 50 as the center line. Oversold territory exists below 30 and overbought territory extends from 70 to 100. Three time frames are used by the Ultimate Oscillator and can be specified by the user. Typically values of 7-periods, 14-periods and 28-periods are used. Note that these time periods all overlap, i.e. the 28-period time frame includes both the 14-period time frame and the 7-period time frame. This means that the action of the shortest time frame is included in the calculation three times and has a magnified impact on the results. By using Ultimate oscillator we can get buy signal. We can get buy signal at three steps. 1. A Bullish Divergence will occur between prices indicator. 2. Bullish Divergence will remain below 30 lines and higher low will consist. 3. Oscillator must cross above Bullish Divergence. Look at the graph. There is a bullish divergence and lower low happened. When a ultimate oscillator cross 50 line then price went up and followed a long rally. So buy this way we can use ultimate oscillator.
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