Interpretation
The idea behind this indicator is that prices tend to close near their past highs in bull markets, and near their lows in bear markets. Transaction signals can be spotted when the stochastic oscillator crosses its moving average.
Two stochastic oscillator indicators are typically calculated to assess future variations in prices, a fast (%K) and slow (%D). Comparisons of these statistics are a good indicator of speed at which prices are changing or the Impulse of Price. %K is the same as Williams %R, though on a scale 0 to 100 instead of -100 to 0, but the terminology for the two are kept separate.
The fast stochastic oscillator or Stoch %K calculates the ratio of two closing price statistics: the difference between the latest closing price and the lowest price in the last N days over the difference between the highest and lowest prices in the last N days:
Where:
CP is closing price
LOW is low price
HIGH is high price
The usual "N" is 14, 9 or 5 days but this can be varied. When the current closing price is the low for the last N-days, the %K value is 0, when the current closing price is a high for the last N-days, %K=100.
The slow stochastic oscillator or Stoch %D calculates the simple moving average of the Stoch %K statistic across s periods . Usually s=3:
The %K and %D oscillators range from 0 to 100 and are often visualized using a line plot. Levels near the extremes 100 and 0, for either %K or %D, indicate strength or weakness (respectively) because prices have made or are near new N-day highs or lows.
There are two well known methods for using the %K and %D indicators to make decisions about when to buy or sell stocks. The first involves crossing of %K and %D signals, the second involves basing buy and sell decisions on the assumption that %K and %D oscillate.
In the first case, %D acts as a trigger or signal line for %K. A buy signal is given when %K crosses up through %D, or a sell signal when it crosses down through %D.[2] Such crossovers can occur too often, and to avoid repeated whipsaws one can wait for crossovers occurring together with an overbought/oversold pullback, or only after a peak or trough in the %D line. If price volatility is high, a simple moving average of the Stoch %D indicator may be taken. This statistic smooths out rapid fluctuations in price.
In the second case, some analysts argue that %K or %D levels above 80 and below 20 can be interpreted as overbought or oversold. On the theory that the prices oscillate, many analysts including George Lane, recommend that buying and selling be timed to the return from these thresholds. In other words, one should buy or sell after a bit of a reversal. Practically, this means that once the price exceeds one of these thresholds, the investor should wait for prices to return through those thresholds (e.g. if the oscillator were to go above 80, the investor waits until it falls below 80 to sell).
The third way that traders will use this indicator is to watch for divergences where the Stochastic trends in the opposite direction of price. As with the RSI this is an indication that the momentum in the market is waning and a reversal may be in the making. For further confirmation many traders will wait for the cross below the 80 or above the 20 line before entering a trade on divergence. The chart below illustrates an example of where a divergence in stochastics relative to price forecasted a reversal in the price's direction.
by George Lane
Aug 25, 2009
Aug 19, 2009
Avoid Bankruptcy By Making Simple Changes
On previous occasions, we have talked about the importance of avoiding bankruptcy and how it is called a last-resort mechanism and should only be used when the situation has no solution through other financial means; such as debt consolidation, debt negotiation or debt settlement.
Today, we would like to show our customers and the people who are seriously thinking about filing for bankruptcy how it is possible to avoid it just by sketching contingency plans and learning how to change damaging spending habits that are one of the main reasons for bankruptcy.
In order to avoid bankruptcy, you as the owner of your assets, will have to make a list of all your valuables that can and should be taken into consideration. Remember to only add items that their value exceeds the $60 mark. Anything goes, from works of art to expensive and modern appliances. This way you will have the chance to evaluate all you possessions and at the same time, you will be able to classify what can be sold, the selling price and if it is already yours, meaning that you might still paying some of the items from the list.
At first, this measurement may be harsh but it is necessary; anything to avoid bankruptcy.
Lynn Johnson is a current customer from our company and is following our counselors� advice. In order to avoid bankruptcy, he started making a list of all his possessions. He just realized that he liked to buy electronic gadgets that he actually did not need. By doing this, he learned that he was overspending on things that were very expensive and not quite essential for his living. He did it because of advertising campaigns and fancy T.V. commercials.
Our bankruptcy specialist, Martin Rogers will show Lynn and us how to avoid bankruptcy by making a few changes and wisely planning how to spend money.
by Martin Rogers
Today, we would like to show our customers and the people who are seriously thinking about filing for bankruptcy how it is possible to avoid it just by sketching contingency plans and learning how to change damaging spending habits that are one of the main reasons for bankruptcy.
In order to avoid bankruptcy, you as the owner of your assets, will have to make a list of all your valuables that can and should be taken into consideration. Remember to only add items that their value exceeds the $60 mark. Anything goes, from works of art to expensive and modern appliances. This way you will have the chance to evaluate all you possessions and at the same time, you will be able to classify what can be sold, the selling price and if it is already yours, meaning that you might still paying some of the items from the list.
At first, this measurement may be harsh but it is necessary; anything to avoid bankruptcy.
Lynn Johnson is a current customer from our company and is following our counselors� advice. In order to avoid bankruptcy, he started making a list of all his possessions. He just realized that he liked to buy electronic gadgets that he actually did not need. By doing this, he learned that he was overspending on things that were very expensive and not quite essential for his living. He did it because of advertising campaigns and fancy T.V. commercials.
Our bankruptcy specialist, Martin Rogers will show Lynn and us how to avoid bankruptcy by making a few changes and wisely planning how to spend money.
by Martin Rogers
Aug 4, 2009
A Chart is a Visual Representation of Data
The term "chart" as a visual representation of data has multiple meanings.
A data chart is a type of diagram or graph, that organizes and represents a set of numerical or qualitative data.
Maps that are ardorned with extra information for some specific purpose are often known as charts, such as a nautical chart or aeronautical chart.
Other domain specific constructs are sometimes called charts, such as the chord chart in music notation or a record chart for album popularity.
Charts are often used to ease understanding of large quantities of data and the relationships between parts of the data. Charts can usually be read more quickly than the raw data that they are produced from. They are used in a wide variety of fields, and can be created by hand (often on graph paper) or by computer using a charting application. Certain types of charts are more useful for presenting a given data set than others. For example, data that presents percentages in different groups (such as "satisfied, not satisfied, unsure") are often displayed in a pie chart, but may be more easily understood when presented in a horizontal bar chart[citation needed]. On the other hand, data that represents numbers that change over a period of time (such as "annual revenue from 1990 to 2000") might be best shown as a line chart.
Features of a chart
A chart can take a large variety of forms, however there are common features that provide the chart with its ability to extract meaning from data.
Typically a chart is graphical, containing very little text, since humans are generally able to infer meaning from pictures quicker than from text. One of the more important uses of text in a graph is in the title. A graph's title usually appears above the main graphic and provides a succinct description of what the data in the graph refers to.
Dimensions in the data are often displayed on axes. If a horizontal and a vertical axis are used, they are usually referred to as the x-axis and y-axis respectively. Each axis will have a scale, denoted by periodic graduations and usually accompanied by numerical or categorical indications. Each axis will typically also have a label displayed outside or beside it, briefly describing the dimension represented. If the scale is numerical, the label will often be suffixed with the unit of that scale in parentheses. For example, "Distance travelled (m)" is a typical x-axis label and would mean that the distance travelled in metres is related to the horizontal position of the data.
Within the graph a grid of lines may appear to aid in the visual alignment of data. The grid can be enhanced by visually emphasising the lines at regular or significant graduations. The emphasised lines are then called major grid lines and the rest of the grid lines are minor grid lines.
The data of a chart can appear in all manner of formats, with or without individual labels. It may appear as dots or shapes, connected or unconnected, and in any combination of colors and patterns. Inferences or points of interest can be overlayed directly on the graph to further aid information extraction.
When the data appearing in a chart contains multiple variables, the chart may include a legend. A legend contains a list of the variables appearing in the chart and an example of their appearance. This information allows the data from each variable to be identified in the chart.
by Cary Jensen and Loy Anderson
A data chart is a type of diagram or graph, that organizes and represents a set of numerical or qualitative data.
Maps that are ardorned with extra information for some specific purpose are often known as charts, such as a nautical chart or aeronautical chart.
Other domain specific constructs are sometimes called charts, such as the chord chart in music notation or a record chart for album popularity.
Charts are often used to ease understanding of large quantities of data and the relationships between parts of the data. Charts can usually be read more quickly than the raw data that they are produced from. They are used in a wide variety of fields, and can be created by hand (often on graph paper) or by computer using a charting application. Certain types of charts are more useful for presenting a given data set than others. For example, data that presents percentages in different groups (such as "satisfied, not satisfied, unsure") are often displayed in a pie chart, but may be more easily understood when presented in a horizontal bar chart[citation needed]. On the other hand, data that represents numbers that change over a period of time (such as "annual revenue from 1990 to 2000") might be best shown as a line chart.
Features of a chart
A chart can take a large variety of forms, however there are common features that provide the chart with its ability to extract meaning from data.
Typically a chart is graphical, containing very little text, since humans are generally able to infer meaning from pictures quicker than from text. One of the more important uses of text in a graph is in the title. A graph's title usually appears above the main graphic and provides a succinct description of what the data in the graph refers to.
Dimensions in the data are often displayed on axes. If a horizontal and a vertical axis are used, they are usually referred to as the x-axis and y-axis respectively. Each axis will have a scale, denoted by periodic graduations and usually accompanied by numerical or categorical indications. Each axis will typically also have a label displayed outside or beside it, briefly describing the dimension represented. If the scale is numerical, the label will often be suffixed with the unit of that scale in parentheses. For example, "Distance travelled (m)" is a typical x-axis label and would mean that the distance travelled in metres is related to the horizontal position of the data.
Within the graph a grid of lines may appear to aid in the visual alignment of data. The grid can be enhanced by visually emphasising the lines at regular or significant graduations. The emphasised lines are then called major grid lines and the rest of the grid lines are minor grid lines.
The data of a chart can appear in all manner of formats, with or without individual labels. It may appear as dots or shapes, connected or unconnected, and in any combination of colors and patterns. Inferences or points of interest can be overlayed directly on the graph to further aid information extraction.
When the data appearing in a chart contains multiple variables, the chart may include a legend. A legend contains a list of the variables appearing in the chart and an example of their appearance. This information allows the data from each variable to be identified in the chart.
by Cary Jensen and Loy Anderson
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