Stochastic Momentum Index
SMIK(%K Periods, %K Smooth, %K Double Periods, %D Periods, MA Type, %D MA Type)
SMID(%K Periods, %K Smooth, %K Double Periods, %D Periods, MA Type, %D MA Type)
The Stochastic Momentum Index, developed by William Blau, first appeared in the January 1993 issue of Stocks & Commodities magazine. This indicator plots the closeness of price relative to the midpoint of the recent high / low range.
The Stochastic Momentum Index has two components: %K (SMIK) and %D
(SMID). %K is most often displayed on a chart as a solid line and %D is often
shown as a dotted line. The most widely used method for interpreting the
Stochastic Momentum Index is to buy when either component rises above 40 or sell when either component falls below 40.
Another way to interpret the Stochastic Momentum Index is to buy when %K rises above %D, or sell when %K falls below %D.
%K Periods: 14
%K Smoothing: 2
%K Double Periods: 3
%D Periods: 9
MA Type: SIMPLE
%D MA Type: SIMPLE
set SMID14 = SMID(14, 2, 3, 9, SIMPLE, SIMPLE)
set SMIK14 = SMIK(14, 2, 3, 9, SIMPLE, SIMPLE)
Set BUY = (SMID14 > 40) OR (SMIK14 > 40)
Evaluates to buy when the Stochastic Momentum Index is in oversold territory.