Stochastic Oscillator
Stochastic oscillator: where the close sits within the recent high-low range, used for overbought / oversold readings and crossovers.
How to read it
- Above 80 is overbought, below 20 oversold.
- %K crossing %D gives early momentum signals, strongest when they happen in the extreme zones.
- Divergences with price warn of a weakening move.
Key settings
- %K 14, %K smoothing 1, %D 3, source close.
- Levels 80 / 20 with a shaded zone.
Good to know
- Drawn in its own pane below the chart.