Awesome Oscillator vs MACD
The awesome oscillator subtracts a thirty-four period simple average of bar midpoints from a five period one. The moving average convergence divergence subtracts a twenty-six period exponential average of closes from a twelve period one and adds a signal line. Both are unbounded differences of two speeds.
Both of these are the same construction: take a fast average, subtract a slow one, draw the difference. Everything that separates them is a parameter choice — which part of the bar goes in, and how the averages weight their history.
What each one is
The awesome oscillator subtracts a thirty-four period simple average of bar midpoints from a five period one, drawn as a histogram. The awesome oscillator covers it.
The moving average convergence divergence subtracts a twenty-six period exponential average of closes from a twelve period one, then adds a nine period signal average and draws the gap between them. MACD covers all three components, and RSI covers the momentum family both sit in.
Neither is bounded, so both can keep saying that a move has got stronger, which is the property that separates them from every position-in-range oscillator.
Where they differ
Which part of the bar goes in. The awesome oscillator averages midpoints — high plus low, halved — so a bar that travelled a long way registers as such. The convergence divergence uses closes only and never sees a wick, so an enormous bar that closed flat is nearly invisible to it.
How an old bar leaves. A simple average drops its oldest bar abruptly, so the awesome oscillator can move on a bar where nothing happened. An exponential average never fully discards anything, so the convergence divergence has no such artefact — but it also never quite forgets a shock.
Whether you get a signal line. The convergence divergence adds one, which turns a level into a discrete crossing you can write a rule around. The awesome oscillator gives you the histogram and leaves the interpretation to you.
How much is on screen. One histogram against a line, a signal and a histogram. Three drawings of one difference is more to look at rather than more information, whereas the single histogram makes the shape the only thing to read.
Where they agree
Both are a fast average minus a slow one. That is the whole architecture in each case, and it is why they agree almost always.
Both cross zero when the fast average crosses the slow one — a real event on the price chart, and the most defensible signal either produces.
Both fight the same drift. On this site’s shared series 54% of 566 ten-bar windows finished higher than they started.
And both cost a round trip when acted on — 0.0098 here, about 2% of the median bar range of 0.493.
Which one to use
Run the awesome oscillator when the bar’s range matters to your instrument. Anything that gaps, wicks hard, or trades thinly is badly served by a close-only tool, because the close on those bars is close to arbitrary.
Run the moving average convergence divergence when you want a written rule. The signal line gives you a crossing, and a rule you can state beats a level you interpret differently depending on your mood.
Run one of them, not both. They share a construction and most of their behaviour, so the second adds confidence without adding information — which is the most expensive kind of addition.
And read the histogram’s shape rather than its sign on either. Shrinking while still positive is momentum fading inside an intact move, and that is the one genuinely early thing this construction offers.
Why the midpoint choice is the substantive one
Because a close is one number selected from a range. On this series the ninetieth percentile bar range is 1.101 and the largest bar spanned 2.338 — on bars that size the close could have landed almost anywhere, and a close-only tool treats each landing spot as a different reading of the same event.
And because thin conditions are where closes mislead most. A wide bar on no participation can finish anywhere, and only the midpoint-based tool has any idea the bar was wide.
The original data
Of the 24,971 unique videos in the search corpus, no title compares these two directly. The moving average convergence divergence appears in 473 titles at a median of 3,534 views across 363 channels. The awesome oscillator appears in 53, at a median of 10,321 across 44.
Nine times the videos and one third of the audience per video. For two tools that are structurally the same thing, that is a striking gap, and it is about naming and association rather than about mechanism — the less-covered one carries a named-method identity and the saturated one does not.
On the chart above they are disagreeing about a wick, not about the market. One tool counted the bar’s range and the other counted only where it closed, which is the single mechanical difference between them.
When it fails
The characteristic failure is running both and treating the agreement as confirmation. They are the same construction with two parameters changed, so they agree by design and the agreement encodes nothing about the market. It feels like corroboration because two separate panels lit up, and that feeling is the most expensive thing on the chart — a second identical opinion raises confidence without raising accuracy, which is exactly the combination that produces oversized positions on ordinary setups. A real second opinion needs a different input, such as volume or the structure of the price itself.
A second failure is trading every zero cross. In a range the fast average crosses the slow one constantly and each crossing pays a round trip.
A third is reading a divergence as a forecast. It describes two lines, and most resolve by the indicator catching up.
A fourth is accepting either set of defaults unexamined. Five and thirty-four, or twelve, twenty-six and nine, are historical numbers rather than tested ones.
And a fifth is judging either on a trending sample, which flatters every difference-of-averages tool.
Related
The awesome oscillator covers the midpoint averages. MACD covers the exponential averages, the signal line and the histogram. And RSI covers the momentum family both belong to.
These are the same indicator with two parameter choices changed. If you are running both, you have one opinion drawn twice in different colours, and the second one is doing nothing except making the agreement feel more convincing than it is.
— Michael Whitman
This page is educational, not financial advice. Test every idea on your own charts before risking money.