The BEST “STOCHASTIC” Trading Strategy | Better Than RSI | Day Trading Stochastic for HUGE Profits

Published on December 31, 2022

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Is stochastic better than RSI. In this video I will go over the basics of stochastic and I will also share a trading strategy based on the stochastic indicator to trade forex, crypto, and stocks.

Topics covered :-
– What is stochastics
– How to plot stochastic
– How to use stochastic in trading
– Trading strategy for stochastic

Brief Overview :-

In this video, I will be sharing a swing trading strategy based on the stochastic indicator that can help you capture short term swings in the market. But, before we start, be sure to hit that like button and subscribe to our channel so that you don’t miss on any of our new videos.

First, let us understand, what is the stochastic indicator?

Stochastic indicator is a short term momentum indicator that is very similar to the RSI indicator.

The basic premise of the stochastic is that it compares the current close to the highest and the lowest closes during a particular time period.

So, if we chose a 10 period stochastic, it will show where the current candle is in the range of the last 10 candles.

So here is the stochastic indicator on the default settings of 14, 1, and 1.

On the indicator’s tab, we have 2 lines. The blue line here is the % K line and the orange line is the % D line.

The blue line is the actual stochastic line. It shows us the actual value of the stochastic.

The orange line is simply a 3 period moving average of the blue line.

Some traders like to use the crossovers of these lines to determine entry and exit points in their strategy. We will cover these crossovers later in this video.

Other than these 2 lines, we have also marked this zone in the middle of the indicator from the 80 level to 20 level.

Just like the RSI, the stochastic indicator is also used to identify overbought and oversold zone.

When the stochastic goes above the 80 level, it is regarded as an overbought area, and we expect the price to make a short term down move.

Similarly, when the stochastic goes below the 20 level, it is regarded as an oversold territory, and we expect a short term upmove.

So, a great strategy would be to sell when the stochastic goes overbought, and buy when it turns oversold.

Right?

No, while that strategy may sound good in theory, but, in real life, the price does not obey the overbought oversold conditions at all times.

Bollinger Bands Uptrends Strategy

Bollinger Bands Uptrends Strategy, The BEST “STOCHASTIC” Trading Strategy | Better Than RSI | Day Trading Stochastic for HUGE Profits.

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That is why it is vital to budget plan your funds according to your expenses and the funds you trade on.
Bollinger studied moving averages and explored with a brand-new envelope (channel) indication.

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A tool, that when used correctly, can assist you check out the marketplace and find entries. With your newly produced trading formula, let us see it in action. Fibonacci series reads Arc, Time fans, retrenchments and zones.

This is the very first phase when you go into trading. You might have picked up a book on technical analysis someplace, become aware of a day trader making millions, or got fortunate in an earlier stock financial investment. After all, how hard can it be? The cash sounds appealing and the freedom to be independent noises appealing.

Tunnel Trading: A breakout will typically happen in the near future when you see the Bollinger Bands ending up being tight and narrow. The longer and narrower the Bollinger Bands are, the higher the breakout will be. This is only true between the times 5 A.M to 5 P.M London Time. Take notice of this reality! Timings make a great deal of difference in currency trading.

If your trade quickly approaches the limitation rate and all your indications state that the cost motion is just getting began & not most likely to rapidly reverse on you, then you need to first either eliminate your limitation price & let the rate run, or, raise your limitation price another 5-10 pips. Then raise your stop to either your entry point or past it, to secure either breakeven or some revenue in case the price unexpectedly reverses on you.

When you use stops and limits while stock trading are identified by your trading system, the information about.However prior to we look at some typical strategies, let’s talk about Bollinger Bands Trader a couple of things NOT to do.

Her injuries were so extreme that the likelihood of her working again in the future was slim at best. She needed Bollinger Bands monetary advice, but who to turn to, she had no concept.

BB’s are readily available on the majority of charting software application. Yahoo has them on their technical analysis charts, as do most other web sites that are committed to technical analysis. If you are not familiar with them I advise you to today, go try out them, utilizing a few stocks and market signs like the Dow, or Nasdaq.

Many traders wait on the cost to strike the middle band and after that move their stop loss to break even. Then they target the extreme band in the direction of the daily pattern.

You can think about the resistance as the ceiling of a space. Generally, PD and FCX are more volatile than copper. In combination with a moving average, you can utilize the bands to recognize support and resistance.

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