Bill Williams' own rules for the Accelerator Oscillator are about bar colour and which side of zero you are on: two bars in agreement when you trade with the momentum, three when you trade against it. What he did not treat as a signal is the zero-line cross itself, and that is where most of the write-ups explaining this indicator part company with him.

What is the Accelerator Oscillator?

A histogram of whether momentum is speeding up or slowing down, built from the Awesome Oscillator. Admiral Markets sets out Williams' chain of reasoning: "Williams maintained that the direction of momentum will always change before the price", and the Accelerator "seeks to go one step further and detect early changes in momentum – that is, when momentum is accelerating or decelerating."

cTrader's help, Forex Strategy Builder's wiki and the Quantower help page all trace it to the same book, "Trading Chaos". cTrader adds the year: "Bill Williams introduced the Accelerator Oscillator in his 1995 book "Trading Chaos" as part of his broader trading methodology."

If you are looking for it in MetaTrader, it is not filed where its name suggests. Admiral Markets: "The standard indicators in both versions of MetaTrader are sorted into four broad categories of: Trend, Oscillators, Volumes, and Bill Williams. Although it is an oscillator, the Accelerator Oscillator is classified in both MT4 and MT5 as being a Bill Williams indicator first and foremost."

What is the Accelerator Oscillator formula?

Three lines, as the Quantower help page prints them:

MEDIAN PRICE = (HIGH + LOW) / 2
AO = SMA (MEDIAN PRICE, 5) - SMA (MEDIAN PRICE, 34)
AC = AO - SMA (AO, 5)

In plain words: the Accelerator is the Awesome Oscillator minus a 5-period average of the Awesome Oscillator. It is a difference of a difference, so it reacts to small changes earlier than the Awesome Oscillator does, and it changes sign more often.

The arithmetic also means the Accelerator cannot be computed without the Awesome Oscillator, and one platform help page states that dependency backwards. cTrader's History section says "Williams later developed the Awesome Oscillator (AO) and introduced it in his book "New Trading Dimensions", published in 1998. The AO builds on data provided by the AC." Two paragraphs below, the same page's Calculations section puts it the other way round: "The Accelerator Oscillator is calculated by subtracting a 5-period Simple Moving Average (SMA) of the Awesome Oscillator from the AO itself." It defines the AO as "the difference between a 34-period and 5-period SMA applied to the Median Price". The calculation and the history on that page point in opposite directions, and the calculation is the part every other document agrees with.

Is the Accelerator Oscillator in ChartLabs?

Yes. Open the chart's Indicators menu, go to the Standard list, and it is called Accelerator Oscillator under the Momentum & Oscillators heading. It opens as a histogram in its own pane below the price, with the bars drawn from a zero line.

Our settings are Williams' three periods, and all three are yours to change: Fast Length 5, Slow Length 34 and Signal Length 5, which is the Awesome Oscillator's 5 and 34 on the bar midpoint minus a 5-bar average of itself. The Awesome Oscillator has its own entry under the same heading, also in a pane of its own.

How do you read the colours?

Green when this bar is higher than the one before it, red when lower. Forex Strategy Builder states it as the mechanical rule: "When the AC value of the current bar is greater than the previous bar value, the histogram bar is colored in green (and vice versa - lower value, red bar)."

Those are also MetaTrader's defaults, which Admiral Markets spells out as "Green for an up-value – i.e. increasing acceleration" and "Red for a down-value – i.e. increasing deceleration".

Then there are Williams' two prohibitions. Admiral Markets: "Williams stressed that with the Accelerator Oscillator, you should not buy if you are seeing a red bar, and you should not sell if you are seeing a green bar." Finlogix puts it the same way.

Colour compares a bar with the bar before it, not with zero. A green bar can sit well below the zero line. Colour and side of zero are two separate pieces of information, and Williams' rules use both.

Is a cross of the zero line a buy signal?

Its author treated the zero line as a condition rather than a trigger, and the write-ups are split on it. Two of the pages that make the cross an entry signal are the help pages of platforms that ship the indicator, which is where a reader is most likely to take a statement as settled.

Document	What it says about the zero line
help.ctrader.com	"Buy signal – traders might consider entering a buy position when the AC crosses above the zero line"
help.quantower.com	"Crossing the zero line - this is a trend-reversing signal, and it can be very useful in case of determining a correction of the existing trend, the beginning of a new trend wave, or starting a new trend"
mql5.com	Codes it as "Strategy one: AC Zero Crossover"
admiralmarkets.com	"Unlike the Awesome Oscillator, crossing the zero line is not a trading signal in itself"
finlogix.com	"However, unlike the Awesome Oscillator, crossing the zero line is not a trading signal on its own"
forexsb.com	Trades bar colour with no zero condition in its prose: "Normally, a green bar of the AC shows us that we can open a long position, and respectively, a red bar - that we can enter a short position"

What Williams himself said about that line, quoted by Admiral Markets: "the zero line is the place where the momentum is balanced with the acceleration". Finlogix reads it the same way and adds what it does leave you with: the cross "indicates a shift in momentum that can provide additional confidence in placing a trade."

The MQL5 article names its first strategy "AC Zero Crossover", and the condition it implements is a comparison of the current value with zero: above zero prints Bullish, below zero prints Bearish. A value above zero is not the same event as a cross above zero. The first holds for as long as the value stays positive, the second happens once, and the two fire on different bars.

A test of the Williams rules is not a test of the zero cross, so decide which one you are testing before you start, and write it down.

What are Bill Williams' rules for the Accelerator Oscillator?

Four rules, in two pairs. Finlogix and Admiral Markets state them the same way.

Trading with the momentum means buying above zero or selling below zero. Those need two bars:

Buy: two green columns in a row above zero.
Sell: two red columns in a row below zero.

Trading against the momentum means buying below zero or selling above zero. Finlogix: "This requires extra confirmation, so wait for three consecutive bars to confirm the trade."

Sell: three consecutive red bars above the zero line.
Buy: three consecutive green bars below the zero line.

Admiral Markets prints the same conditions and is careful about the status it gives them: "a possible Accelerator Oscillator strategy could interpret two green columns in a row above zero as a buy signal".

Williams did not treat the indicator as a standalone system either. Admiral Markets: "Williams himself suggested using the Alligator Indicator as the biggest determiner of whether to trade or not." That is a different indicator with its own rules.

What are the best Accelerator Oscillator settings?

On MetaTrader there is nothing to tune but the look of the histogram. Admiral Markets, describing the settings dialogue: "As you can see, there isn't a great deal for you to configure there. The main choice is simply the look and feel of the histogram, with a choice of colours and line thickness."

Somewhere else, there is plenty. Forex Strategy Builder's wiki is a strategy builder's reference, so it exposes the inputs the MetaTrader version hides:

Parameter	Its default	What else it offers
Smoothing method	Simple	Weighted, Exponential, Smoothed
Base price	Median	Open, High, Low, Close, Typical, Weighted (seven in all)
Slow MA period	34	1 to 200
Fast MA period	5	1 to 200
Forming MA period	5	1 to 200
Level	0	-10 to 10

So "the Accelerator Oscillator has no settings" is only true of one platform: in Forex Strategy Builder the base price, the smoothing method and all three periods are yours to change. The Level parameter also means the zero line is not fixed everywhere. The same page lists logic conditions including "The AC is higher than the Level line" and "The AC crosses the Level line upward", with Level defaulting to 0.

The settings question has no published answer to look up. If you change the fast, slow or forming period, change one of them, keep the rules and the period identical, and record the signal count each time.

What is the difference between the Accelerator Oscillator and the Awesome Oscillator?

Three differences.

The arithmetic. The Accelerator is the Awesome Oscillator minus a 5-period average of itself, as every document that prints a formula agrees.

What is being measured. The Awesome Oscillator is about momentum, the gap between a fast and a slow average of median price. The Accelerator is about the rate of change of that gap. Finlogix: it "goes a step further by measuring the acceleration or deceleration of that momentum."

The zero line. Admiral Markets and Finlogix both open the relevant sentence with "unlike the Awesome Oscillator", which tells you what they take the convention to be on the other indicator: there a zero cross is read as a signal, on the Accelerator it is not.

What is the difference between the Accelerator Oscillator and MACD?

Two differences.

The inputs. The Accelerator uses the median price of each bar, (High + Low) / 2, through simple moving averages with periods that MetaTrader does not let you change. MACD is built from closing prices through exponential moving averages, with three settings you can change.

The signal line. MACD carries one, the Accelerator does not. Because of both differences the two histograms can look alike without being the same series, so a rule tuned on one will not transfer unchanged to the other.

Has anyone tested the Accelerator Oscillator?

Nothing published that you could check Williams' rules against. The MQL5 article that codes them is explicit about its scope: "you must test them before using them on your real account as the main objective here is educational only", and it repeats the instruction in its conclusion: "you must test any mentioned strategy before using it on your real account". The code it attaches calls the terminal's Comment() function to print "Bullish", "Bearish", "Buy" or "Sell" on the chart, and places no orders.

So the rules come to you unverified.

How do you backtest the Accelerator Oscillator yourself?

Six decisions, all made and written down before the first trade.

Pick one rule set, Williams' two-bar and three-bar conditions or the zero-line cross. Not both, because they fire on different bars, and a test of both at once cannot tell you which one did the work.
Fix the entry bar exactly: the second confirming bar, or the one after it. This matters more here than on most indicators, because the Accelerator is a difference of a difference, so its sign and its colour can change on a bar where price barely moved. A one-bar difference in where you enter is a different strategy.
Fix what cancels the setup. If the third bar breaks the sequence, or the histogram crosses zero before you are filled, is the setup dead? Decide in advance, or you will judge borderline cases inconsistently and never notice you did.
Decide the against-the-momentum cases up front. Williams asks for three bars there rather than two, so those setups will be rarer. Count them separately or they will quietly become a tiny sample inside your sample.
Pick the period before you look at the chart. Choosing dates after seeing where the histogram behaved is a test of hindsight.
Set the costs before the first trade. In ChartLabs, commission and slippage are set per symbol, and every trade's P&L, balances and analytics reflect them. A signal that fires as often as this one does is flattered badly by a zero-cost test.

On our chart a bar takes the up colour when it is higher than the bar before and the down colour otherwise, which is the colour rule above. Nothing here backtests it, so the testing stays manual: you step the chart forward bar by bar and take the trades by hand, which is the point, because what you measure is what you would actually have done.

You can also add your own custom indicators from the Indicators menu. Drawings and sub-panel indicators save as you work, and each indicator instance can be styled separately, so the layout you tested with is the one you come back to.

Our forex backtesting guide covers the surrounding method, including how many trades a result needs before it means anything, manual versus automated backtesting covers what each approach can and cannot tell you, and our trading simulator is the bar-by-bar stepping this kind of test needs.

The notes that make the test repeatable

Ten lines per test.

The symbol and the timeframe.
The platform, and whether its periods were adjustable.
The period tested, with both dates.
Which rule set: the two-bar and three-bar conditions, or the zero cross.
Whether each trade was with the momentum or against it.
Which bar you entered on.
What cancelled a setup.
How many signals the period produced.
How many of those were against-momentum three-bar setups.
The result, with commission and slippage already in it.

Two results are only comparable if both carry their signal count.

Start a free trial and test one of the two rule sets properly rather than both loosely.

How to Use the Accelerator Oscillator: Williams' Rules