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The standard Chaikin Oscillator is a stock market technical indicator used to make stock buying and selling decisions.

The oscillator is created by

  1. creating a time-series of the closing prices of the stock,
  2. calculate the Accumulation/Distribution Line of the time-series generated in step 1.
  3. subtract a 10-period exponential moving average of the Accumulation/Distribution Line time-series calculated in step 2 from a 3-period exponential moving average of the same Accumulation/Distribution Line calculated in step 2.

The formula equivalent of the calculation is shown below:

L = accumulation_distribution(close)

Then, subtract the two exponential moving average time-series.

C = EMA(L, 3) - EMA(L, 10)

A basic trading rule is to buy when the oscillator drops below zero, and to sell when the oscillator goes above zero.

Technical Indicators

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