Technical Analysis of Stochastic Oscillator Indicator

A lot of metals trading information can be gathered from the shapes and duration of the metal market tops and bottoms of the stochastic oscillator metals indicator.

The amount of time that metals stays overbought or oversold is an important factor when analyzing the strength of the metal market trends.

Metal Trading Market Tops

Narrow metals market top that doesn't reach very high above 80%

Narrow metals market tops means that the bulls are weak, and that the metals trading bears have overpowered the metals trading bulls very quickly. This means that the metals trading bears might push the metals price further down without much resistance from the metals trading bulls.

Very high, wide metals market tops

Wide metals market tops mean that the metals trading bulls are very powerful much more than the metals trading bears and the ensuing short term metals trend reversal (retracement), will be very short lived. The retracement on the stochastic oscillator metals technical indicator will not even reach the oversold levels before stochastic oscillator metals technical indicator moves back to the over bought areas.

Metal Trading Market Bottoms

A narrow metals market bottom that doesn't reach very deep below 20 %

The narrow metals market bottom means that metals trading bears are weak in their attempt to push the metals price down, the metals trading bulls have gained control of the metals price pretty fast so the metals price movement upwards will continue for a while. And the upward metals market trend will continue for a while.

Very wide, deep metals market bottoms

A wide metals market bottom is a sign that the metals trading bears are very strong and the metals sellers are in control of the metals price, therefore any retracement upwards will not stay for long.