Stochastic definition is: An oscillator (to measure the movement up and down) that measures overbought and oversold conditions in the market. Two Stochastic lines similar to the MACD line, the line which one is faster than the other.
How to apply stochastic
Stochastic showing overbought and oversold conditions on a scale from 0 to 100. When the stochastic line above 80, means the market is in overbought conditions (a good indication to open a sell position). And when the Stochastic is below 20, meaning the market in oversold conditions (a good indication for the open buy position.)
stochastic oscilator picture
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