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Gold Spread of Williams

In his book «The secrets of trade on the futures ryke, act together with the insiders» Larry Williams gives a description of the indicator «Spread Williams», to monitor the relationship of gold and the dollar index. Here is what he writes about this:

«It seems that everything looks like this: Gold may rise faster than the U.S. dollar only until it starts to fall. This relationship is difficult to see, considering the graphics, but not difficult to find when you look at the relationship between the spread of these markets. To detect the relationship, which I like to watch, you need to take a one-week spread between the two markets, then build a three-week moving average and a 21-week moving average of that spread. To see the pendulum oscillations of the spread, I continue to deduct the three-week moving average of the 21-week moving average. Divide the result by 100 gives us a uniformly distributed factor, so when a suitable scale can be seen any time. Doing these calculations, I have noticed that when the ratio passes through the region, ie when relevant to the three 21-week spread over 30%, the gold market soon discovered recession. In other words, the gold may be perekuplennym in relation to the dollar, and at this point in time, large sums of money professionals entering the market to take advantage of these imbalances through the sale of gold ».

: From the above, you can get the formula for calculating this inidcator:

(SMA 21 (IndexDollar-Gold) - SMA 3 (IndexDollar-Gold)) / 100


  • SMA 21 - 21-periodically simple moving average
  • SMA 3 - three-week simple moving average
  • IndexDollar - index of the dollar
  • Gold - Gold


1.Vyberete weekly schedule of gold.

2. Join the indicator to the schedule.

3. Give the input parameter "symbol_name" title graphics dollar index (the default name for the index is equal to the value of the dollar "DX_CONT", but every broker uses his name tool). If the current value of indicator more than 0.3 (30%), then wait for the imminent reduction in the value of gold (metal overbought). If the indicator below -0.3 (-30%), then wait for the imminent price increase (metal resold).

IMPORTANT NOTE: This is a long-term indicator, it is best to use it for a week taymfreymah. His task to point to the future movement last 6 months or more.

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Download forex - indicator Golden Spread Williams

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