April 18, 2024

Stochastic Oscillator

The Stochastic Oscillator is a momentum indicator that helps to identify potential reversals in the market. It tracks the closing price of an asset relative to its range over a given time frame. The indicator is calculated with two lines, %K and %D, and is used to help identify overbought and oversold levels. Traders also use the Stochastic Oscillator to identify the momentum and potential for reversals in any market. The indicator is a powerful tool to identify the key turning points along any security’s trend. %K is the primary line and %D is the signal line, which is a simple moving average of %K. Maximum values indicate that an asset is overbought; on the other hand, minimum values indicate it is oversold.

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