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Microcap & Penny Stocks : BANY: Core business growth, exciting affiliations! -- Ignore unavailable to you. Want to Upgrade?

To: Hockeyfan who wrote (2754)	9/2/1998 12:12:00 PM
From: Mike Sawyer	Read Replies (2) \| Respond to of 5847

You can get a good understanding about each of the technical indicators by clicking on the indicator's link under the graph. I couldn't explain it any better. Here's what it said about the Stochastics indicator... Stochastics Technical Indicator Definition Developed by Dr. George C. Lane of Investment Educators, Stochastics measures the position of a stock compared with its most recent trading range. Specifically, it measures the relationship between the closing price of a stock and its high and low during a specific number of days or weeks. As a stock price rises, the closing price tends to be, on average, closer and closer to the extreme highs of the stock, and as prices fall, the closing price tends to fall, on average, closer and closer to the extreme lows. The formula is: Stochastics = (Last Close - N-low) / (N-high - N-low) Where: N = the number of days or weeks over which the Stochastics index is being calculated N-low = lowest stock price during the past N period N-high = highest stock price during the past N period The Stochastics values are then smoothed with a simple moving average. Stochastics indicate overbought and oversold. They can be very useful as a timing aid in knowing when to take action in a stock, particularly when used in conjunction with othertechnical indicators. Stochastics may also be used with industry groups or market indexes. Interpretation It is important to watch the indicator as it crosses the 75 percent and 25 percent lines. 75 percent line - Overbought Condition: When the Stochastics indicator goes above the 75 percent line, the stock is in an overbought condition. This occurs if the closing price is near the top of the recent trading range and signals a possible correction. But this does not mean that a top has been formed. When the indicator starts falling, however, the stock would be interpreted as topping out, and a new downtrend (negative breakout) comes when the Stochastics indicator crosses the 75 percent line going downward. 25 percent line - Oversold Condition: When the Stochastics indicator falls below the 25 percent line, the stock is in an oversold condition. This happens when the closing price is near the low end of the recent trading range and signals a possible market rally. A bottom forms when the Stochastics indicator is below the 25 percent line, but the stock has not bottomed out until the index starts to rise. A new uptrend (positive breakout) is indicated when the Stochastics indicator crosses the 25 percent line going upward. The Stochastics indicator may be calculated for short or long time periods, but the sensitivity of the indicator increases with shorter time spans. A time span that is too short, however, increases the likelihood of "whipsaws" by giving too-frequent signals. A time span that is too long may camouflage important signals, by requiring a major price move to generate a trend reversal. Since many stocks can produce significant moves without breaking the 75/25 line, we have added the ability to plot the difference between the Stochastics and a moving average of the Stochastics. In this case: A buy signal is given when the histogram crosses the zero line from negative to positive. A sell signal is indicated when the histogram crosses the zero line from positive to negative. The presence of a second moving average will determine which Stochastics curve is displayed. Portfolio Monitoring Monitor the stocks in your portfolio for Stochastics breakouts by selected short-term, intermediate-term, and long-term technical breakouts from the portfolio bar. These signals can be used to time purchase or selling of your stocks. For example, if you copy the results of a search into your portfolio, you can wait to purchase any stock until they have a positive breakout. This can help increase the probability that you have a stock in an uptrend. Then you can hold the stock until a sell signal is given. Breakouts are calculated approximately every hour throughout the day. Just click on the arrow in the technical breakout section to see the technical graph. Search for Stock with Stochastic Breakouts You can search for stocks with various Stochastics values. Select Stochastics breakout from Prosearch. You can search for stocks with breakout in the last x number of days and can combine them with any of our other indicators. Also, you can find stocks with the highest and lowest RSI values, or combine your search with other technical indicators. Click here for a description of Stochastics search criteria. Disclaimer Be aware that technical analysis is not foolproof and frequently produces bad signals. They should not be used as an automated buy and sell program but as a tool to enhance your probability of holding winning stocks. All technical analysis is based on mathematical calculations and, as such, no investment decision should be based solely on its conclusions.