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1992issue C121-2

Constructing fast and slow stochastic oscillator lines

The stochastic oscillator reports where the latest close sits inside a user-chosen high-low window. Percent K is that unsmoothed ratio scaled by 100. Percent D smooths the same numerator and denominator over the last three readings. The slow stochastic relabels that companion line and applies one further three-session moving average.

  • The stochastic oscillator measures where the latest close sits inside a user-chosen high-low range rather than treating the close as a standalone level.
  • Percent K is the close minus the window low, divided by the window high minus the window low, then scaled by 100, using a lookback window chosen by the user.
  • Percent D sums the last three percent-K numerators, divides by the last three percent-K denominators, and scales that ratio by 100.
  • The slow stochastic relabels the already-smoothed companion as slow percent K and applies a three-session moving average to obtain the new percent D.
Entries in this reading1 entry
Current trackStochastic oscillator170 readings

The close inside a chosen range

The stochastic oscillator measures where the latest close sits inside a user-chosen high-low range rather than treating the close as a standalone level. It is a two-line construction that places the latest close inside a user-chosen high-low window and reports that position on a scaled scale.

Percent K and the lookback window

Percent K is the unsmoothed reading formed from the close, the window low, and the window high. It is the close minus the window low, divided by the window high minus the window low, then scaled by 100.

The lookback window is the number of sessions used to find the highest high and lowest low that define the range. The lookback length that defines the window high and window low is chosen by the user. A ten-session window is the worked example.

Percent D as a companion line

Percent D is a companion line that smooths the same numerator and denominator series over a short additional window. The second line is formed by summing the last three percent-K numerators, dividing by the last three percent-K denominators, and scaling the ratio by 100.

A worksheet reconstruction

A worksheet reconstruction first isolates the window high and window low, then builds the numerator as close minus window low and the denominator as window high minus window low. Those two pieces are the inputs that percent K scales by 100, and they are the same numerator and denominator series that percent D sums over the last three readings.

10-period %K and 3-period %D from the worksheet

Percent K tracks where each close sits in the last 10 sessions; Percent D is the three-period smoothed companion. Values are taken cell-for-cell from the sidebar worksheet, not from a plotted curve.
Percent K tracks where each close sits in the last 10 sessions; Percent D is the three-period smoothed companion. Values are taken cell-for-cell from the sidebar worksheet, not from a plotted curve.worksheet example · daily · 1992-08-17T00:00:00.000Z to 1992-09-17T00:00:00.000Z

Lookback n=10 for the high-low window; %D uses a three-session sum of the %K numerator and denominator. The first nine dates have no oscillator values because the 10-day window is not yet full; %D begins one session after the first %K.

Relabeling into the slow stochastic

The slow stochastic is a variant that treats the already-smoothed companion as a new raw line and then applies one further moving-average pass. The slow form keeps those same inputs: it relabels the already-smoothed companion as slow percent K and then applies a three-session moving average to obtain the new percent D.

Educational research material, not investment advice. Historical source context does not establish present-day performance.
8 of 42 in the Stochastic oscillator track
19921-11 pp.Next on Stochastic oscillatorConstructing nested stochastic lookbacksA nested-lookback-stack computes the same stochastic formula at several horizons and draws the series together so short, intermediate, and long windows can be compared.
All readings on this track · 42 readings
  1. 1987Stochastic fast and slow construction as a rebuildable stack
  2. 1989Building the stochastic oscillator from close location
  3. 1990Monthly stochastics as a multi-year bond regime filter
  4. 1990Walk-forward screen for yen indicator rules
  5. 1990Slow stochastic construction for index pullback entries
  6. 1991Random Walk Index construction with an adaptive lookback
  7. 1991Building a two-stage stochastic oscillator from close location
  8. 1992Constructing fast and slow stochastic oscillator lines
  9. 1992Constructing nested stochastic lookbacks
  10. 1994Construct the four-state price-volume rank before filtering it
  11. 1996Crowded stochastics, false breakouts, and hidden stops
  12. 1997Fade and follow entries from stochastic extremes
  13. 1998Oversold confirmation as a staged rule-based-entry case
  14. 1999Constructing regular and slow stochastic oscillators
  15. 2001Construct a variable-interval simple moving average from stacked extremes
  16. 2001Threshold RSI and stochastic setups with next-bar stops
  17. 2001Two tests of a rate-adjusted earnings-yield gap
  18. 2002Constructing a two-line stochastic from a range-normalized close
  19. 2002Inspect mechanical stochastic daytrade rules on one bar
  20. 2003Constructing an adaptive stochastic RSI
  21. 2003Four parameters that construct a stochastic oscillator
  22. 2004Volume breakout as signal, pullback as entry
  23. 2004A first currency-market checklist with two averages and a slow stochastic
  24. 2005Shared-scale cycle indexes with companion oscillators
  25. 2005Current-bar versus prior-bar range construction for the stochastic oscillator
  26. 2005Two-session moving-average pullback short
  27. 2006Market condition as a permission layer for moving averages and oscillators
  28. 2008Lock the stop at support before sizing a stochastic entry
  29. 2010Construct a center-line volume oscillator and read it with a stochastic oscillator
  30. 2010Sharpened RSI turns with rainbow averages and a slow stochastic
  31. 2011Build a Spearman rank oscillator from ordered closes
  32. 2012Gold as a regime-dependent hedge in the euro-area crisis
  33. 2012Pairing moving averages with variable-length stochastics
  34. 2014Two-leg stochastic stress oscillator as a rebuild drill
  35. 2014Ingress dates as price bases for relative strength, stochastics, and moving averages
  36. 2017Constructing a dual EMA stochastic from range normalization
  37. 2018Constructing a two-stage stochastic RSI for comparable price-oscillator divergences
  38. 2018Combining a weekly stochastic, a long moving average, and two-day resistance
  39. 2018Weekly and daily stochastic readings with a long moving average and support
  40. 2018A confirming workflow for rotating from discretionary to staples
  41. 2019Stochastic scan thresholds, averages, and formula syntax
  42. 2020Constructing Slow %K as a two-stage helper
By fieldIndicators and filters682 readingsBy year1992115 readings
All 170 readings tagged Stochastic oscillator
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