In order to improve the predictive accuracy of grey system prediction model with a stochastic oscillation sequence,this paper proposes an algorithm which can compress the amplitude and improve the smoothness of a stochastic oscillation sequence through a smoothness operator,and then deduces and establishes the prediction model of stochastic oscillation sequence.Through some examples' simulation, this paper compares simulation errors of this model with others;the results show that this novel method can evidently improve the simulative accuracy of stochastic oscillation sequence.