✓ Mathematical
◆ The Pattern%K = (Close − Lowest Low) / (Highest High − Lowest Low) × 100.
The Stochastic Oscillator — developed by George Lane in the 1950s.
%K = (Close − Lowest Low) / (Highest High − Lowest Low) × 100
%D = SMA(3) of %K
%D = SMA(3) of %K
Scale: 0–100. Default lookback: 14 periods.
Signals:
• Above 80 = overbought, below 20 = oversold
• %K crossing above %D = buy
• %K crossing below %D = sell
The slow stochastic uses smoothed %K for fewer false signals.
• Above 80 = overbought, below 20 = oversold
• %K crossing above %D = buy
• %K crossing below %D = sell
The slow stochastic uses smoothed %K for fewer false signals.
Pattern bridge: Where price sits in its recent range is a percentile rank. The smoothed %D line is an EMA applied to the oscillator — momentum of momentum.