Define: McClellan Oscillator

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Definition: McClellan Oscillator



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Full Definition of McClellan Oscillator


The McClellan Oscillator is a market breadth indicator that shows overbought and oversold trends in the NYSE stock exchange. When the McClellan Oscillator is positive it indicates money is coming into the market and negative values indicate money is leaving the market.

The McClellan Oscillator is calculated as the difference between a fast and a slow Exponential Moving Average of the daily market breadth (daily advancers – decliners). Typically, 39 days is used for the fast EMA and 19 days for the slow EMA.

McClellan Oscillator = EMA (#Advancing – #Declining),19) – EMA (#Advancing issues – #Declining),39)

where:

  • EMA is the Exponential Moving Average
  • #Advancing is the number of daily advancing issues
  • #Declining is the number of declining issues

The McClellan Oscillator is primarily used for short and intermediate-term trading of the NYSE composite index. The index is considered to be overbought when the oscillator lies between 70 and 100 and oversold when the indicator lies between -70 and -100. Over 100 and below -100 are considered to be extremely overbought and oversold conditions, respectively.


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Definition Sources


Definitions for McClellan Oscillator are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 23rd March, 2020