It is no secret that market trends are quite rare. There are times when the market is static and flat. In trading, sideways movements are extremely dangerous since the market tends to lose most of its value when it exhibits no clear trend. Studies indicate that financial markets and individual securities tend to trend just 15% to 30% of the time, whereas 70%-85% of the time, they go sideways (trend horizontally). Bill Williams, an American author who specializes in trading psychology, created the Alligator Indicator based on this postulation.
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