Stochastic Oscillator
Technical AnalysisA momentum oscillator comparing the close to the recent price range, on a 0–100 scale, to flag overbought/oversold conditions.
The stochastic oscillator compares a currency's closing price to its price range over a set lookback period, plotted on a 0–100 scale, to gauge momentum and potential overbought (above 80) or oversold (below 20) conditions. It consists of two lines, %K and %D, whose crossovers are commonly used as entry or exit signals.
Like RSI, the stochastic oscillator can remain pinned at extreme readings through a strong trend, so it's typically combined with trend or price-action context rather than traded in isolation.