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For example,
a (14, 1, 3) Full Stochastic is equivalent to a (14, 3) Fast Stochastic while a (12, 3, 2) Full Stochastic is identical to a (12, 2) Slow Stochastic. |
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| Much as
the Fast and Slow Stochastics, the number of periods used to create the initial %K line is defined by the first parameter. %D is again the number of periods that is used to create the signal line. |
This indicator
is helpful in currency trading. Readings above 80 act as an overbought signal while readings below 20 act an oversold signal.
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However,
even if the Stochastic Oscillator has reached 80 securities can continue to rise. Similarly even after it has reached 20 it can continue to fall.
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In currency trading,
we advise you to test this tool in demo account trading before using it in real account.
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