The Forecast Oscillator was developed by Tushar Chande. The Forecast Oscillator is an extension of the linear regression based indicators, by definition. It is a percentage comparison of the price of an issue and the price as indicated by the Time Series Forecast Oscillator.
The oscillator is above zero when the forecast price is greater than the actual price. Conversely, it’s less than zero if its below. When the forecast price and the actual price are the same the oscillator would plot as zero.
Prices that are persistently below the forecast price suggest lower prices ahead. Actual prices that are persistently above the forecast price suggest higher prices ahead.
The Forecast Oscillator is in simple words, a comparison (in percentage) of the issue price and the price as seen by the Time Series Forecast Oscillator. It’s an extension of the indicators which are based on linear regression.
The oscillator is above the zero point if the forecast price is higher than the current price. On the contrary, if it’s below it turns out to be less than zero. When the forecast price and the current price are equal, the oscillator makes a zero. Current prices that are constantly over the forecast price suggest higher prices ahead and prices that are constantly under the forecast price suggest lower prices ahead.
It is calculated as follows:
(Close – Previous Time Series Forecast) * 100 / (Close)
The Forecast Oscillator is a variant of the Time Series Forecast. It calculates the percentage difference between the time series forecast and the actual price.
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