Stochastic Stocks Indicator Crossover Signals

One way to interpret the stocks signals provided by the Stochastic Oscillator stocks indicator is similar to a moving average crossover stocks strategy. In the Stochastic oscillator stocks indicator, a crossover stocks signal happens when the %K and %D lines crossover. These crossover stocks signals should be taken with scrutiny as, out of the stocks stochastics oscillator trading signal interpretations discussed so far, they produce the most stocks whipsaws. Whipsaws or False stocks signals are especially common in the Fast Stochastic Oscillator Stocks Indicator version.

Stochastic Oscillator Crossover Stocks Signals:

• For a Sell stocks signal, a stocks trader looks for the %K line to move below the %D line.
• For a Buy stocks trade signal, a stocks trader looks for the %K line to move above the %D line.

Since stochastic crossovers stocks signals of %K and %D are often unreliable, they should be verified with other stocks trading technical trading indicators.

The Stochastic Oscillator Stocks Indicator Center-line

The stochastic oscillator center-line lies at the 50% level in the stochastic stocks indicator panel. It implies that there is a balance between bulls and bears. Situations when the stochastic stocks indicator crosses the center-line can give an insight into whether the buyers or sellers will begin to control the stock trend.

Stochastic Oscillator Center-line Stock Crossovers Signals

• If the Stochastic oscillator stocks indicator is staying below the center-mark (between 40%-50%) and crosses up, then it is an indication that the stocks bulls are taking control of the stocks market.
• If the Stochastic oscillator stocks indicator is staying above the center-mark (around 50%-60%) and then crosses below the center-mark, it can be an indication that the stocks bears have taken control of the stocks market.