For installation of Stochastics, we should click the button Indicators at a toolbar and select from the appeared menu Ocillators- Stochastics Ocillator
After that, appears is a window where we can change properties of the exposed indicator. We can select two periods of averaging, deceleration, a moving average method, what input data uses the indicator, to fix a maximum and a minimum. We can change visual settings on the Colours tab.
Stochastics is one of the most often used indikator .We can change it on the Colours tab.
As a psychological assistant, it is the most successful and useful indicator.
Stochastics in the formula considers not only the prices of closing, but also the ceiling and minimum prices during the certain time frame, i.e. comprises much more information, than any other oscillator This indicator was developed by George S. Lane in the 50th years, and his formula looks as follows: where K - stochastic oscillator of Lane, C - the final price of closing, L - the lowest level for the last N of the periods, H - the highest level for the last N of the periods.
Afterwards, Stochastics began to smooth twice. At first in "percent of KA" (fast stochastics), for the last n of the periods.
and after that in "%D Percent" (slow stochastics) is the simple sliding average from %К.
Such strange names turned out when the group of traders developed formulas for oscillators, sequentially giving them names %А, %В, %С, etc. There were only three working: %К, %D and %R.
The first two curves are known as stochastic Lane, and last bears a name of Larry Williams and the following tutorial will be devoted to it.
Trade on intersection of lines K and D is the most interesting.
Also, their mutual state can be used as an input affirmation.