Momentum Indicator. A dynamic excel document to predict price turning points. Used in Technical Analysis.
Warning: Last items in stock!
The term stochastic refers to the point of a current price in relation to its price range over a period of time. This method attempts to predict price turning points by comparing the closing price of a security to its price range.
The current security's price is expressed as a percentage of the range with 0% indicating the bottom of the range and 100% indicating the upper limits of the range over the time period covered. The idea behind this indicator is that prices tend to close near the extremes of the recent range before turning points.
A 3-line Stochastics will give an anticipatory signal in %K, a signal in the turnaround of %D at or before a bottom, and a confirmation of the turnaround in %D-Slow. Typical values for N are 5, 9, or 14 periods. Smoothing the indicator over 3 periods is standard.
Dr. George Lane developed this indicator in the late 1950s.
Example stock data of Apple is included.
Also included is a profit simulation to see the effect of the variable input of the buy- and sell moments on the profit.
System requirements: windows, excel 2007 or higher.
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