# Wave Trend Oscillator Wave Trend Oscillator is an indicator on [Vela](https://vela.luxalgo.com/chart), our next-generation charting platform, written in Pine Script®. Plots the WT1 wave and its WT2 signal line in a dedicated pane: smoothed, deviation-scaled momentum swinging around zero with paired overbought/oversold levels at 53/60 and -53/-60. Defaults follow the widely used construction (HLC3 source, channel length 10, average length 21, signal length 4), for traders timing reversals at momentum extremes. - Indicator in the LuxAlgo Library, by LuxAlgo, published May 9, 2026. - Access: free. - Concepts: [Wave Trend Oscillator](https://www.luxalgo.com/library/concept/wave-trend-oscillator/) (primary) - Open on Vela: https://vela.luxalgo.com/chart?pineScriptCodeId=c4ofmli3favra248no8n7eyz - Page: https://www.luxalgo.com/library/indicator/wave-trend-oscillator/ **Wave Trend Oscillator** is the definitive clean build of the [Wave Trend Oscillator](https://www.luxalgo.com/library/concept/wave-trend-oscillator/), plotting the WT1 wave and its WT2 signal line in a dedicated pane. Price's distance from an exponential mean is scaled by its typical size, then smoothed into legible waves around zero. WT1 is colored by its side of WT2, a gradient fill ties it to zero, and dashed levels at 53/60 and -53/-60 frame the extreme zones. ## How to Trade the Wave Trend Oscillator? - **Bearish extreme cross**: WT1 crossing under WT2 with both above Overbought 1 is the classic overbought reversal trigger; the bullish mirror fires below Oversold 1. - **Zero-line regime**: WT1 crossing above zero marks waves unfolding on the bullish side of the centerline; crossing below flips the read. - **Zone traversal**: WT1 pushing above Overbought 1 flags stretch; its cross back below signals the stretch unwinding. Mid-range crosses are left to the line coloring, where follow-through is poorest. Eight alerts cover extreme crosses, zone entries and exits, and zero crosses. ## Wave Trend Oscillator Settings - **Source** (default HLC3): price series measured. - **Channel Length** (default 10): length of the exponential mean and deviation averages. - **Average Length** (default 21): smoothing that turns the scaled deviation into WT1. - **Signal Length** (default 4): bars in the WT1 average forming WT2. - **Overbought 1 / Overbought 2** (defaults 53 and 60): inner level qualifying extreme crosses and zone alerts, outer level bounding the shaded band. - **Oversold 1 / Oversold 2** (defaults -53 and -60): the mirrored levels below zero. - **Extreme Cross Markers** (default off): circles where extreme crosses fired; alerts work regardless. - Style toggles: **Gradient Fill** and **Extreme Zone Fill** (both on by default). ## Frequently Asked Questions ### How is the Wave Trend Oscillator different from the CCI? Both gauge how far price has stretched from an adaptive mean (this build keeps the 0.015 scaling), but the [Commodity Channel Index](https://www.luxalgo.com/library/indicator/commodity-channel-index/) publishes the ratio nearly raw, while this tool double-smooths it and adds a signal line. The result is fewer, cleaner swings for extra lag. ### Are the 53 and 60 levels reliable everywhere? They are conventions, not hard bounds: the oscillator is deviation-normalized rather than capped, so quiet and volatile instruments stretch differently. All four levels are inputs. Adjust to where your market's waves historically turned. ### What is the main weakness to plan around? In a strong trend WT1 can camp beyond an extreme as cross after cross against the trend fails. Treat extreme crosses as timing inside a directional framework; the zero-line regime read helps pick the side. ## Related indicators - [Internal Candle Strength](https://www.luxalgo.com/library/indicator/internal-candle-strength/) (Balance of Power): markdown at https://www.luxalgo.com/library/indicator/internal-candle-strength.md - [Pretty Good Oscillator](https://www.luxalgo.com/library/indicator/pretty-good-oscillator/) (Momentum & Oscillators): markdown at https://www.luxalgo.com/library/indicator/pretty-good-oscillator.md - [Gator Oscillator](https://www.luxalgo.com/library/indicator/gator-oscillator/) (Momentum & Oscillators): markdown at https://www.luxalgo.com/library/indicator/gator-oscillator.md - [Traders Dynamic Index](https://www.luxalgo.com/library/indicator/traders-dynamic-index/) (Momentum & Oscillators): markdown at https://www.luxalgo.com/library/indicator/traders-dynamic-index.md - [Center of Gravity](https://www.luxalgo.com/library/indicator/center-of-gravity/) (Momentum & Oscillators): markdown at https://www.luxalgo.com/library/indicator/center-of-gravity.md - [QQE Weighted Oscillator](https://www.luxalgo.com/library/indicator/qqe-weighted-oscillator/) (QQE): markdown at https://www.luxalgo.com/library/indicator/qqe-weighted-oscillator.md - [5/35 Oscillator](https://www.luxalgo.com/library/indicator/5-35-oscillator/) (Momentum & Oscillators): markdown at https://www.luxalgo.com/library/indicator/5-35-oscillator.md - [Inverse Fisher Transform](https://www.luxalgo.com/library/indicator/inverse-fisher-transform/) (Momentum & Oscillators): markdown at https://www.luxalgo.com/library/indicator/inverse-fisher-transform.md --- Source: https://www.luxalgo.com/library/indicator/wave-trend-oscillator/ (LuxAlgo Library). Free to use with attribution: https://www.luxalgo.com/library/license/