Know Sure Thing (KST) | Indicator Series

If you are interested in trading, then there are a plethora of tools and strategies that you can use in order to get some skin in the trading game and excel at it. Currently, there are at least 200 technical analysis tools known to traders; however, I am going to explain the technical analysis tool known as Know Sure Thing so that you can have one more tool in your toolbox. 

What is Know Sure Thing? 

Know Sure Thing(KST) is a trading indicator strategy that uses the momentum oscillator. The momentum oscillator is a technical analysis tool that measures the speed of a security’s price change and then it generates the data on the price chart in which the price either swings above or below the Zero line based on price fluctuation. Generally, if the price is above the Zero Line, then momentum is up and the price is positive. Conversely, if the price is below the Zero Line, then momentum is down and the price is negative.  Access the economic calendar for your trading strategies to see upcoming news events on Tradingview.

How Know Sure Thing Is Used 

  1. First, KST selects the Rate-of-Change(ROC) of four given time periods (daily, weekly, monthly) on the price chart. 
  1. Then, it uses Moving Averages(MA) to cut out the fluff short-term price fluctuations. 
  1. Afterward, a calculation is performed on the Rate-of-Change Moving Averages (ROCMA). 
  1. Lastly, the result of the calculation is used to better comprehend the momentum of a particular security. The momentum indicates a trend that helps a trader to make better decisions. 
  • The mathematical formula used to calculate KST: (ROCMA1 x 1) +(ROCMA2 x 2) + (ROCMA3 x 3) + (ROCMA4 x 4).  
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How Know Sure Thing Is Commonly Used in Trading Strategy? 

Know Sure Thing is used in trading strategy as a trading indicator that can help traders identify buying and selling signals generated by: 

  • Crossover signals 
  • Bullish and bearish divergence 
  • Overbought and oversold readings 
  • Crossovers of the central line 

Conclusion 

In conclusion, Know Sure Thing is a trading indicator strategy that uses the momentum oscillator to help traders identify buying and selling signals generated by factors such as crossover of the central line, overbought and oversold readings, bullish and bearish divergence, and crossover signals.   

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