Stock Predictor trading strategy

Fast Stochastic Crossing

The Fast Stochastic Oscillator shows where the closing price lies within the high–low range of the last n days, on a scale from 0 to 100. Its %D line is a moving average of %K.

Strategy group

Stochastic oscillator strategies

Based on

Fast Stochastic %K and %D

Typical parameters

%K = 5 or 14 days, %D = 3 days

When the two lines cross, price momentum is changing direction. This strategy buys when %K crosses above %D and sells when %K crosses below %D.

Trading signals

• Buy when %K crosses above %D.
• Sell when %K crosses below %D.

Strategy rules

IF STO%K >= STO%D
   THEN GO LONG
ELSE IF STO%K <= STO%D
   THEN GO SHORT

Where STO%K and STO%D are the %K and %D lines of the fast stochastic oscillator.

See also: how the Fast Stochastic Oscillator indicator is calculated.