Tag: stochastics

Parabolic SAR and Stochastics MTF Trading System

Parabolic SAR and Stochastics MTF Trading System

Trading Strategies
The Parabolic SAR is a versatile trading indicator which can be effectively used as a trailing stop indicator. It forms a kind of trend following strategy and works best when markets are in a strong trending mode. When combined with the Stochastics oscillator, which basically oscillate between overbought and oversold conditions, thus representing rising and falling momentum, the Parabolic SAR and Stochastics trading system can make for a very unique trading system in itself. This unique approach is further enhanced with a contrarian approach of using multiple time frames. Using the well known approach of using a higher time frame to determine trends, the MTF approach is rather simple. Parabolic SAR and Stochastics Chart Set ups The chart set up is very simple and the Parabolic SAR as ...
Trading with Stochastics Oscillator

Trading with Stochastics Oscillator

Trading Indicators
Stochastics Oscillator or Stochs for short is a trend oscillator tool used in technical analysis of the markets. Stochastics measures overbought and oversold conditions in the markets, similar to Relative Strength Index or RSI. It is one of the default trading indicators available on most trading platforms and charting packages. While it isn't clear as to who discovered the Stochastics Oscillator, two names pop up prominently with this indicator. Namely, Dr. George Lane and Ralph Dystant. The Stochastics Oscillator looks identical to the MACD indicator and is made up of two lines where one is a faster signal line and works on the concept that while prices are in an uptrend, the price action tends to close at the high of the candle and vice versa when markets are in a downtrend. ...