Alligator
Overview
Bill Williams' Alligator uses three smoothed moving averages displaced forward — the Jaw, Teeth, and Lips — to identify trending and sleeping market phases with an intuitive visual metaphor. When the lines intertwine the Alligator is "sleeping" (range); when they fan out it is "eating" (trending). Combine it with the Awesome Oscillator and Gator Oscillator from our indicator guide library for the complete Bill Williams trading system.
How It Works
Jaw = 13-period SMMA displaced 8 bars forward (blue). Teeth = 8-period SMMA displaced 5 bars forward (red). Lips = 5-period SMMA displaced 3 bars forward (green). The displacement shifts each line into the future, creating a visual lag structure that reveals trend phases clearly.
Key Signals
- All three lines intertwined = Alligator sleeping; avoid trend-following trades.
- Lips crossing above Teeth and Jaw = Alligator awakening; bullish trend beginning.
- Lines fanning out with Lips on top = strong uptrend (Alligator eating).
- Lines converging after a trend = potential reversal or consolidation.
Common Mistakes
- Forcing trades when the Alligator is sleeping — most false signals occur here.
- Changing the displacement values without understanding the system design.
- Using the Alligator without its companion indicators (AO and Gator Oscillator).
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