2. Stochastic
• Stochastic helps us to determine whether price is
overbought or oversold on a 0-100 scale.
• Near the 80 mark means that the stock is being
overbought. This may be indicating that interest in
the stock is short term and people will be moving out
of the stock soon after they make some money. The
trading signal here is to sell when the red line crosses
beneath the grey line from above the 80 marker.
3. Stochastic
• Near the 20 marker means that the stock is
being oversold and that it could represent a
good bargain as it may be moving towards a
valuable buy. The trading signal here is to buy
when the red line crosses above the grey line
from below the 20 marker. Divergence signals
when found strengthen your position.
4. Stochastic
• Stochastic is only valuable if the share is trading
sideways
• Watch for V when the share is in the over sold
territory
• Watch for the reverse V in the over bought territory
• Caused by a strong or a weak day on the stock price
• Usually see 3 to 4 day run up or down
• Use it with other indicators
5. Pat Lynch who lives in Cork, Ireland uses these slides
plus more to present a one day seminar on the Stock
Market. Pat can be contacted at
patlynch@stockmarkettraining.ie
or by phone +353872416668
Check my LinkedIn profile
http://ie.linkedin.com/pub/pat-lynch/b/898/6a8
or web site: www.stockmarkettraining.com
I am interested in delivering this seminar worldwide.
Get a group together and call me. Also interested in
finding partners worldwide