A technical analysis indicator, developed by Larry Williams in order to help investors notice buy and sell signals. Ultimate oscillator uses weighted average of three different overlapping time periods (usually 7, 14 and 28 days) and is expressed as percentage.
Buy signals are emphasized when prices make new lows buy the oscillator does not or when the oscillator falls below 30 and the stock is considered oversold. Sell signals are emphasized when ultimate oscillator rises above 70 and the stocks are considered overbought.
In general, buy and sell signals are derived from situations when the price and oscillator value moves in opposite directions.