Best Parameters for Stochastic
Results 1 to 7 of 7
Like Tree1Likes
  • 1 Post By MeiHua

Thread: Best Parameters for Stochastic

  1. #1
    glenjumilla is offline Newbie
    Join Date
    Jun 2012
    Posts
    20

    Default Best Parameters for Stochastic

    hi!

    i'd like to know what do you think are the best parameters to use for stochastic?

    what do you use? the standard (14,3,3)?

    i plan to trade on the 1HR, 4HR, and Daily charts. what do you think would be a good stoch parameter for them?

    thank you,
    Mr. Newbie

  2. #2
    MeiHua's Avatar
    MeiHua is offline FX-Men Honorary Member
    Join Date
    Jul 2011
    Location
    In the Market
    Posts
    1,345
    I don't trade much with indicators, but i would say that using the defaults are probably quite robust, also if there is any self fulfilling prophecy to it it should be on default as that's what most people would use. If you end up optimizing the parameters for each time frame and each pair, your going to end up curve fitting which will almost guarantee your losses.
    SoundOfLight likes this.

  3. #3
    SoundOfLight's Avatar
    SoundOfLight is offline Junior Member
    Join Date
    Jul 2012
    Location
    Right here, right now
    Posts
    282
    agreed with MeiHua. i do use indicators, but tend to leave the common settings - cuz as said it ends up being a self-fulfilling prophecy. and yup, once you start tweaking, you tweak it to match ONE set of price curves but that causes it to clash with another set of price curves, and then you have to re-tweak. your brain suffers, as does your equity.

    and obviously, the best indicator is the one that's always there - the price. the best settings are what your own psyche is most comfortable with. 5min? 1hr? daily? yes, they're all 'good', but only one is 'right' for you and your style of trading.

  4. #4
    Spiperman's Avatar
    Spiperman is offline Newbie
    Join Date
    Oct 2011
    Posts
    52
    I use standard settings (14,3,3) on all those timeframes too.
    Checking them from a multiple time frame analysis perspective can give you solid entry - exit points!
    But do yourself a favor and don't trade the stochastic signals, trade PRICE ACTION with confirmation from indicators...
    Like a bearish engulfing on H4 while stochastics is still on overbought is a setup I would take, I wouldn't wait for
    stochastics to retrace from the overbought territory! It may be too late...

  5. #5
    MeiHua's Avatar
    MeiHua is offline FX-Men Honorary Member
    Join Date
    Jul 2011
    Location
    In the Market
    Posts
    1,345
    Actually I just wrote a post today regarding much of the same thing from spiperman, someone was asking how to use oscillators (stochs, macd, rsi) to trade ranges. I gave a full analysis and showed how price and volume lead the indicator. it was just a standard MACD with default settings trading the USDJPY. But you can see here the lag is at least 3 bars. That may cost you in some situations, but here its ok. IF price runs away on you then your going to end up with a bad entry and chasing the train after it already left the station.

    Here is the screenshot i took for it you can read the whole link below.




    Trading schemes.....

  6. #6
    glenjumilla is offline Newbie
    Join Date
    Jun 2012
    Posts
    20
    thank you for the replies everyone!

    yup, use common settings for indicators because they are common! haha. =)

    and yup, i'll use them in conjunction with price action. =)

  7. #7
    JJ6845616's Avatar
    JJ6845616 is offline Senior Member
    Join Date
    Dec 2011
    Posts
    344
    If you want to notice Divergence than 5,3,3 is the best setting.
    Otherwise,to avoid much whipsaws you may use default parameters 14,3,3 but may it'll be a bit late.

Forum Sponsors

Similar Threads

  1. Looking for Stochastic RSI oscillator
    By fxsterling in forum Free Forex Trading Systems
    Replies: 0
    Last Post: 12-22-2007, 02:36 PM
  2. Best time for trading?
    By robbie in forum Newbie Island
    Replies: 3
    Last Post: 10-17-2007, 10:53 AM
  3. Yen: The Best Trade for the End of the Year?
    By DailyFx in forum The Analyst Arena
    Replies: 0
    Last Post: 08-31-2007, 02:50 PM
  4. which the best point for Divergence
    By ALSA3QAH in forum Free Forex Trading Systems
    Replies: 1
    Last Post: 07-01-2007, 11:17 PM
  5. Best Indicators for Overbought/Oversold?
    By LizTrader in forum Newbie Island
    Replies: 6
    Last Post: 03-10-2007, 08:34 PM

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •  
"A man is a success if he gets up in the morning and goes to bed at night and in between does what he wants to do."
Bob Dylan