Home > Technical analysis > Indicators and oscillators > Full Stochastic Oscillator (Full STO)

Full Stochastic Oscillator (Full STO)

The combination of the Slow Stochastic and the Fast Stochastic is called a Full Stochastic. It uses 3 parameters:

The uniqueness of Slow Stochastic is that it uses a "smoothing factor" for the initial %K line that is "n-period" SMA (n is the same number as the middle parameter) of the initial %K line

The Full Stochastic Oscillator is more advanced and more flexible than the Fast and Slow Stochastic and can even be used to generate them. For example, a (14, 1, 3) Full Stochastic is equivalent to a (14, 3) Fast Stochastic while a (12, 3, 2) Full Stochastic is identical to a (12, 2) Slow Stochastic.

Full Stochastic

Much as the Fast and Slow Stochastics, the number of periods used to create the initial %K line, is defined by the first parameter. %D is again the number of periods that is used to create the signal line.

Readings above 80 act as an overbought signal while readings below 20 act an oversold signal. However, even if the Stochastic Oscillator has reached 80 securities can continue to rise. Similarly, even after it has reached 20 it can continue to fall.

Related topics: