Technical Analysis: The McClellan Oscillator
The McClellan Oscillator is a technical analysis tool used to evaluate the strength or weakness of the stock market by measuring the difference between the number of advancing and declining stocks. It is calculated by taking the difference between the 19-day exponential moving average (EMA) and the 39-day EMA of advancing stocks minus the difference between the 19-day EMA and the 39-day EMA of declining stocks. The oscillator generates signals based on its crossovers with a signal line, which is usually a 9-day EMA of the oscillator. The McClellan Oscillator is used to identify overbought and oversold conditions and to confirm market trends.