Stochastic Chart
The theory behind the indicator is that prices tend to close near the upper end of a trading range during an uptrend. As the trend matures, there is a tendency for prices to close away from the higher end of the trading range. The reverse case applies for a downward market.
The stochastic attempts to measure the points in a rising trend at which the closing prices tend to hover around the lows for the period. When the stochastic reaches the extreme of 100 or 0, it signals that a strong move may be under way.
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