Description
Stochastic is one momentum analysis tool of a graph based on the ratio between the current minimum/maximum and the average minimum/maximum of the analyzed period.
Through momentum analysis, this tool allows you not only to identify the directionality of a trend, but also his Force, as well as the exact moment in which its drive will fail and, therefore, when the trend reversal becomes a correct and rational hypothesis. The indicator is graphically composed ago two lines (%K And %D) which oscillate within values from 0-100, generating intersecting operating signals.
There %K line, colored Green in the graph, is also called Fast Line and is given by the percentage distance of the closing price from the average high or low of the period. There %D line, red in colour, is also called Slow Line and it is the 3-period moving average of the Fast Line.
The Green line it is, by nature, more responsive to price changes and volatility. The red line, however, has a trend slower and blunter but it generates more reliable signals, eliminating market noise from the oscillator, thus avoiding volatility spikes and inflationary spikes.
Our Stochastic has the particularity of having the Multi Timeframe function. That is, if you are viewing an Hourly timeframe chart you will be able to view in the oscillator, for example, the result of the D1 timeframe.
Another peculiarity are the arrows that we draw in the graph, at the moment of the intersection between the 2 stochastic lines.
Functionality
- Multi Timeframe indicator
- Colorful arrows.
Parameters
- %K Periods: Choose the number of periods of the %K line (green line)
- %K Slowing: Choose the number of periods of %K Slowing.
- %D Periods: Choose the number of periods of the %D line (red line)
- MA Type: Choose the type of Moving Average on which the indicator must perform calculations.
- Timeframes: Select the Timeframe on which you want to display the oscillator.
- Smoothing: Select Yes if you want the oscillator line to be rounded, or No if you want to leave the display at each bar.
- Arrow Distance: Select the distance in pips from the candlesticks, for the drawn arrows.