The Estocstico is an Oscillator that compares the present price of a currency with the prices of the same currency in a certain period If we are in the presence of a bullish tendency, the prices of closing of a currency obvious tend to be near the maximum values of that currency. To the inverse one, when the tendency is bear, the prices of closing tend to be near the minimum prices of that currency. These oscillating identify a pair of lines, %K and %D, being last %D, the one that indicates the probable signals of purchase or sale. Generally almost all the TRADING platforms of the different Broker houses have this indicator, that it is reflected in the graphs of each pair of currencies. There is a datum point for each line, settling down a species of channel in which both move. The part superior of the channel shows value 70 and the inferior shows value 30 The advantage of these estocsticos is the one identification " divergencia" with respect to the series of prices of a pair of currencies.

When the line %D it locates over 70 and it forms &quot every time; maximum more bajos" whereas the prices form " minimums more and more altos" , one takes place what one is denominated " divergence bajista" . When the line %D is placed below 30 and forms &quot every time; minimums more altos" , whereas the prices form " maximums more and more bajos" , one takes place what one is called " divergence alcista". The sale or purchase signals can be produced when the line of %K cuts to the line of %D. These signals significant if they take place in the maximums or the minimums of the estocstico, always will only be transferred line 70 (upwards) or of the 30 (downwards). The best results can be obtained in the weekly graphs. It is recommended to use these oscillating like complements of other indicators, since the signals that can give must be confirmed and not to take themselves from isolated way. More information in Original author and source of the article.