Slow Stochastic - SST
The Stochastic Oscillator is also a momentum indicator. It shows the location of the present market closing price relative the high/low price range set over a number of periods. George Lane developed the stochastic indicator. There are three types of stochastic, Fast, Slow and Full. TradeWithPros utilizes the slow stochastic set at 5,5.
When the reading moves below 20, the market is considered oversold. When it moves above the 80 line it is considered overbought. Once again traders look for divergence, trendline breaks and patterns in the stochastic indicator to assist in trading decisions. Do not use this indicator solely on its own.
Below is IBM with the Slow Stochastic.
Next: Relative Strenght Index - RSI