Oscillator

An oscillator is a technical analysis indicator that fluctuates above and below a centerline or between set levels as its value changes over time. Oscillators are used to identify overbought or oversold conditions, as well as to spot divergences that may signal a trend reversal.

Common examples of oscillators include:

• Relative Strength Index (RSI)
• Stochastic Oscillator (Fast and Slow)
• Commodity Channel Index (CCI)
• Moving Average Convergence Divergence (MACD) (although it's also a trend-following indicator)

Oscillators are most effective when used in ranging markets where the price is not trending strongly in one direction.