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OsMA Oscillator – Moving Average (of Oscillator)

Discussion in 'Traders Glossary' started by GlossaryEditor, Aug 15, 2015.

  1. GlossaryEditor

    GlossaryEditor Glossary Editor

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    OsMA is an abbreviation that stands for “Oscillator – Moving Average (of Oscillator)”. This is a fundamental method which is widely used in technical analysis to express the deviation between the oscillator value and its moving average for some period. This foundation comes from statistics and could be explained by the fact that some variable has a limited deviation from its mean. That’s why, when the oscillator (i.e. variable) shows significant deviation from its average (i.e. mean) the oscillator has a tendency to return back to its mean. That triggers corresponding price action, since obviously the oscillator is based on the prices of some particular asset.

    For more information and illustrations, please see the OsMA entry in the FPA's Forex Encyclopedia.


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