How to get a good stochastic oscillator indicator?

<p id="isPasted">Choose the most effective variables for your trading style by deciding how much noise you’re willing to accept with the data. Understand that whatever you choose, the more experience you have with the&nbsp;indicator&nbsp;will improve your recognition of reliable signals. Short-term market players tend to choose low settings for all variables because it gives them earlier signals in the highly competitive&nbsp;intraday&nbsp;market environment. Long-term market timers tend to choose high settings for all variables because the highly smoothed output only reacts to major changes in&nbsp;price action.</p><div style="box-sizing: border-box; overflow-wrap: break-word; color: rgb(17, 17, 17); font-family: SourceSansPro, &quot;Source Sans Pro-fallback&quot;, sans-serif; font-size: 18px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: 0.05px; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; white-space: normal; background-color: rgb(255, 255, 255); text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial;"><br></div><div style="box-sizing: border-box; position: relative;"><div style="box-sizing: border-box; height: 501.6px; overflow: hidden; background: 0px 0px; position: relative; width: 600px; padding-bottom: 0px;" class="forexqa-img-container"><img width="4584" height="3834" data-sizes="750px" alt="Image" data-hi-res-src="https://www.investopedia.com/thmb/lKUPjeHJOPuUbPNJJC7fpmxczgE=/1500x0/filters:no_upscale():max_bytes(150000):strip_icc():format(webp)/dotdash_Final_Pick_The_Right_Settings_On_Your_Stochastic_Oscillator_SPY_AAL_Jun_2020-01-763c8471cbd94fa7bda0e21de6ce792c.jpg" data-img-lightbox="true" sizes="750px" srcset="https://www.investopedia.com/thmb/8HbZ01Kpg2Ae7RT5gVx895gu1U4=/750x0/filters:no_upscale():max_bytes(150000):strip_icc():format(webp)/dotdash_Final_Pick_The_Right_Settings_On_Your_Stochastic_Oscillator_SPY_AAL_Jun_2020-01-763c8471cbd94fa7bda0e21de6ce792c.jpg 750w" src="https://prod-forexqna.s3.amazonaws.com/uploads/froala_editor/images/1738906466062.png" style="box-sizing: border-box; height: auto; max-width: 100%; background-color: rgb(212, 212, 212); width: 730px; cursor: zoom-in;" class="fr-fic fr-dii fr-draggable forexqa-img"></div></div><p>Image by Sabrina Jiang © Investopedia&nbsp;2020</p><p>SPDR S&amp;P 500 Trust (SPY) shows different Stochastics footprints, depending on variables. Cycle turns occur when the fast line crosses the slow line after reaching the overbought or oversold level. The responsive 5-3-3 setting will flip buy and sell cycles frequently, often without the lines reaching overbought or oversold levels. The mid-range 21-7-7 setting will look back at a longer period but keeps smoothing at relatively low levels. However, the setting yields wider swings that generate fewer buy and sell signals. The long-term 21-14-14 setting takes a giant step back, signaling cycle turns rarely and only near key market turning points.</p><p>Shorter-term variables elicit earlier signals with higher noise levels, while longer term variables elicit later signals with lower noise levels, except at major market turns when time frames tend to line up, triggering identically-timed signals across major inputs. You can see this happen at the October low, where the blue rectangle highlights bullish crossovers on all three versions of the indicator. These large cycle crossovers tell us that settings are less important at major turning points than our skill in filtering noise levels and reacting to new cycles. From a logistical standpoint, this often means closing out trend-following positions and executing fading strategies that buy pullbacks or sell rallies.&nbsp;<br></p>

<p>To get a reliable stochastic oscillator indicator, you must customize its settings to match your trading style and combine it with other technical analysis tools to filter out false signals. The "best" stochastic indicator is not a single setting, but one that is optimized for your specific strategy, whether you are a day trader, swing trader, or long-term investor.&nbsp;</p>