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Strategies & Market Trends : Trading the SPOOs with Patrick Slevin!

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To: SE who wrote (6306)9/14/2000 2:34:01 PM
From: Lee Lichterman III   of 7434
 
There are two formulas that I am aware of. The simplest is the following.

%K = 100 * (close - Lowest low of Y periods) / (highest high of Y periods - Lowest low of Y periods)

%D = 100 * (X period sum of the (close - lowest low of Y periods) / the X period sum of (the highest high of the same period used in the above formula - lowest low of the same period used in the above formula)

Basically %D is a smoothing of the %K and the periods X and Y don't have to be and usually are not the same. For example many popular sites use 14 and 6 as the parameters of the equation.

Hope this helps.

Good Luck,

Lee
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