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Oscillators > TurboStochasticsFast

Article/Author: Omega Research Inc., 1996

Download: TURBOSTOCHASTICSFAST.ELA

File Includes: Indicator - TurboStochasticsFast

Category: Indicator > Oscillators

Description:

This is Stochastic Fast indicator smoothed by linear regression. A LinearRegression projected into the future or into the past is used to excite the movement of the stochastic lines while smoothing them. Linear regression is a statistical tool used to predict future values from past values. In the case of security prices, it is commonly used to determine when prices are overextended. A Linear Regression trendline uses the least squares method to plot a straight line through prices so as to minimize the distances between the prices and the resulting trendline.

Usage:

The Stochastic Oscillator is displayed as two lines. The main line is called "%K." The second line, called "%D," is a moving average of %K.
There are several ways to interpret a Stochastic Oscillator. Three popular methods include:

1.Buy when the Oscillator (either %K or %D) falls below a specific level (e.g., 20) and then rises above that level. Sell when the Oscillator rises above a specific level (e.g., 80) and then falls below that level.

2.Buy when the %K line rises above the %D line and sell when the %K line falls below the %D line.

3.Look for divergences. For example, where prices are making a series of new highs and the Stochastic Oscillator is failing to surpass its previous highs.




Inputs:

KLen - SlowK length
DLen - SlowD length
Regress - number of bars to calculate regression
TurboVal - TurboVal is a positive or negative value by which you project the regression. Positive for Past and negative for Future.

EasyLanguage Code:
INPUT:KLEN(20),DLEN(20),REGRESS(10),TURBOVAL(-10);


VALUE1 = FASTK(KLEN);
VALUE2 = FASTD(DLEN);

VALUE3 = LINEARREGVALUE(VALUE1,REGRESS,TURBOVAL);
VALUE4 = LINEARREGVALUE(VALUE2,REGRESS,TURBOVAL);

PLOT1(VALUE3,"TURBOFK");
PLOT2(80,"80");
PLOT3(20,"20");
PLOT4(VALUE4,"TURBOFD");