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Strategies & Market Trends : Befriend the Trend Trading
SPY 692.24+0.3%Jan 15 4:00 PM EST

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To: Dr. Stoxx who wrote (2403)12/5/1998 5:30:00 PM
From: Charles Kalb  Read Replies (1) of 39683
 
Thomas.....Thanks for your reply but I would like to add a clarification. The two Stochastic curves shown in the timely.com chart are a %K and a %D which is simply a moving average of %K, as you stated. However, the %K shown is NOT the so-called Fast Stochastic (without internal smoothing). I used a MetaStock charting/TA program to attempt to duplicate the two Stochastic curves in the timely.com chart. The Fast Stochastic is extremely jagged and would result in many false signals as it crossed a %D trigger line. The only way I was able to duplicate the timely.com curves was to input a 3-day slowing factor for %K in the MetaStock program. Note that this slowing factor is NOT a moving average of %K, it is a separate averaging procedure performed on the numerator and denominator of the defining Stochastics relation.

I conclude from this that you are implicitly recommending a 14-period Slow Stochastic with 3-period slowing for the %K line and a 3-period moving average of %K for the %D line.

The slowing factor was what I was looking for in my Post #2402, and I have deduced a value of 3 periods by comparing the timely.com charts, which we use all the time on this thread, with another charting program.

Charles
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