The Stochastic is a momentum indicator that was developed by George C. Lane in the fifties and is similar to the RSI, but more volatile. 

It compares the closing price of a candle with previous price levels to determine if the price is overbought or oversold. When it increases, the bulls drive the price up, and when it decreases the bears are more present in the market.

Overbought zones are areas where the price has increased a lot in a small period of time. Then, assuming that the price is overbought and that it can have a trend reversal or correction. Therefore signaling a sell.

Likewise, oversold zones are areas where the price has decreased sharply in a relatively small interval of time. They are interpreted as buy points because the price is likely to increase afterwards.


What strategies does Bottrex provide for RSI?

  • Upward crossing - K: When% K is GREATER than% D and to reinforce a check is made on the penultimate candle:% K LESS than% D.
  • Downward crossing - D: When% K is LESS than% D and to reinforce a check is made on the penultimate candle:% K is GREATER than% D.
  • Ascending crossing (region) - K: When% K is GREATER than% D and both are BELOW the defined value. To reinforce, a check is made on the penultimate candle:% K LESS than% D
  • Downward crossing (region) - D: When% K is LESS than% D and both are ABOVE the set value. To reinforce, a check is made on the penultimate candle:% K GREATER than% D
  • Below value: Checks if% K and% D are below the set value.
  • Above value: Checks if% K and% D are above the defined value.
  • Upward Trend: Checks if% K is greater than% D. Ideal for analyzing trends and can be combined with other indicators.
  • Downtrend: Checks if% D is greater than% K. Ideal for analyzing trends and can be combined with other indicators.