What is Stochastic Oscillator?
Stochastic Oscillator Indocator
Stochastic Oscillator is one of some indicators to identify when a trend is going to end. Stochastic Scillator is an oscillator that will calculate the boredom of selling and buying condition in the forex trading market. There are 2 curves similar to MACD indicator in which one is faster than the other.
(we will upload the picture soon)
How to use Stochastic Oscillator?
Stochastic Oscillator will recognize whether the forex trading market is bored or not. The scale of stochastic is 0 to 100. If the stochastic curve is above 70 (in the chart above is shown with red horizontal lines), it indicates the boredom in buying condition (overbought). If the stochastic is under 30 (in the chart above is shown with blue horizontal lines), it indicates the boredom in selling condition (oversold).
(we will upload the picture soon)
In the chart above, you will see that the stochastic indicator shows a quite long overbought condition. From this information, can you guess where is the next price movement going?
(we will upload the picture soon)
If your guess is the price is going down, then your answer is correct. Because the market has been experiencing overbought condition for quite long, the price will be down. It is the main function of stochastic which is to determine when the overbought and oversold condition will happen.
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Read More about Technical Analysis:
Bookmark/share this article with others:Stochastic Oscillator is one of some indicators to identify when a trend is going to end. Stochastic Scillator is an oscillator that will calculate the boredom of selling and buying condition in the forex trading market. There are 2 curves similar to MACD indicator in which one is faster than the other.
(we will upload the picture soon)
How to use Stochastic Oscillator?
Stochastic Oscillator will recognize whether the forex trading market is bored or not. The scale of stochastic is 0 to 100. If the stochastic curve is above 70 (in the chart above is shown with red horizontal lines), it indicates the boredom in buying condition (overbought). If the stochastic is under 30 (in the chart above is shown with blue horizontal lines), it indicates the boredom in selling condition (oversold).
(we will upload the picture soon)
In the chart above, you will see that the stochastic indicator shows a quite long overbought condition. From this information, can you guess where is the next price movement going?
(we will upload the picture soon)
If your guess is the price is going down, then your answer is correct. Because the market has been experiencing overbought condition for quite long, the price will be down. It is the main function of stochastic which is to determine when the overbought and oversold condition will happen.
Thank you for visiting our blog Learn Forex Trade ..
Read More about Technical Analysis:
- Technical Analysis in Forex Trading
- Forex Trading Charts
- Japanese Candlestick Patterns
- Forex Pattern Recognition
- Hammer and Hanging Man Patterns
- Support and Resistance Indicator
- Forex Trendline Indicator
- Forex Channel Indicator
- Fibonnaci Squence Golden Ratio
- Understanding Fibonacci Squence
- Fibonacci Retracement
- Moving Average Method
- Which are is better between SMA and EMA?
- Forex Trading Common Indicators
- What is Bollinger Bands?
- What is MACD?
- What is Parabolic SAR?
- What is Stochastic Oscillator?
