Technical Analysis of Stochastic Oscillator Technical Indicator

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

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

Commodity Trading Market Tops

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

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

Very high, wide commodity market tops

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

Commodity Trading Market Bottoms

A narrow commodity market bottom that does not reach very deep below 20 %

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

Very wide, deep commodity market bottoms

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