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➡️ Know Sure Thing :
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(Note - you can find this indicator in many platforms in-built indicator section.)
✅What Is the Know Sure Thing (KST)?✅
+ The Know Sure Thing (KST) is a momentum oscillator developed by Martin Pring to make rate-of-change readings easier for traders to interpret.
+ The KST is calculated by taking the simple moving average (SMA) of four different rate-of-change (ROC) periods, adding them together to come up with the KST, and creating a signal line by taking the 9-period SMA of the KST.
🛑 Understanding the Know Sure Thing (KST) 🛑
+ The KST indicator can be used in the same manner as many other momentum oscillators, such as the well-known relative strength index (RSI).
+ Trading signals are generated when the KST crosses over the signal line, but traders may also look for convergence and divergence with the price, overbought or oversold conditions, or crossovers of the center line.
+ Many traders combine the KST indicator with other forms of technical analysis to maximize their odds of success.
+ For example, traders may look at other non-momentum indicators, chart patterns, or candlestick patterns to help in their decision-making.
🟩 Example of KST 🟩
+ (please refer example)
+ Let's take a look at an example chart:
In the example, the KST indicator reached highly overbought conditions in early February and eventually experienced a crossover, which generated a well-timed sell signal.
+ The indicator also crossed over in late February, mid-March, and mid-April with limited success, but the key is looking for both overbought or oversold conditions, as well as a crossover to signal the trade.
+ Traders may have also looked at other forms of technical analysis to maximize their odds of a successful trade.
+ For example, traders looking at the example chart may have considered the significant bearish volume on the day that the signal occurred or the candlestick patterns leading up to the trading signal when making their decision.
+ These insights could also be used to avoid making less profitable trades suggested by the KST indicator.
☣️ How to use the Know Sure Thing indicator? ☣️
+ Know Sure Thing continuously oscillates above or below the Zero Line.
+The reading is positive when the KST is above the Zero Line and it indicates that it is favoring the bulls.
+ The reading is negative when the KST indicator is below the Zero Line and it shows that the momentum is favoring the bears.
+ The positive readings show positive weighted and smooth values of the rate of change and increasing prices of the financial assets.
+ The negative readings illustrate the downtrend with falling prices of the stock.
+ The basic centerline and signal line crossovers are the strongest signals provided by the Know Sure Thing indicator.
+ Traders can really capitalize on this strength. They should search for signal line crossover after witnessing the basic centerline crossover.
+ They should also detect the general direction of the trend as well. As a general rule, the KST ascends when it is above the signal line and it descends when below the signal line.
+ An ascending and negative Know Sure Thing line indicates the weakening of the downside momentum. A descending and positive Know Sure Thing line shows the waning upside momentum.
+ Moreover, bullish and bearish divergence signals are also possible but they cannot be used every time.
+ The chartists are advised to be selective before using them. They are also encouraged to experiment with different settings because one size may not fulfill the requirements of the traders.
+ They can also experiment with moving average settings and try mixing and matching the rate of change settings to maximize their odds of success.
☢️ The pros and cons of the Know Sure Thing indicator ☢️
✅ Pros ✅
+ The KST indicator was invented to make interpretation of the rate of change’s readings easy for the trader.
+ It has several other advantages that make it one of the most efficient indicators among the technical analysis tools.
+ Its response rate is comparatively higher than any other momentum oscillator.
+ It is a versatile indicator that can be used on all timeframes ranging from short term to long term.
+ It serves multiple purposes such as to seek divergences, signal line crossovers, and centerline crossovers.
+ Its basic centerline and signal line crossovers are considered the strongest signals to measure the strength of a trend
⛔ Cons ⛔
+ There is no doubt that the Know Sure Thing oscillator is one of the best trading tools, yet it has certain disadvantages as well.
+ It may give false signals like any other indicator.
+ It requires the assistance of other indicators to confirm the validation of a trend
📶 Conclusion 📶
+ The Know Sure Thing oscillator is considered among the most reliable and user-friendly momentum oscillators.
+ It captures four different price cycles as it is based on the rate of change of four different time periods.
+ The indicator makes every time period smooth through a moving average.
+ It is a powerful indicator that has the potential to help you maximize your trading profit. Technical analysts suggest maximizing with different settings to enhance the chances of maximizing gain.
+ However, the default setting of the KST is recommended for novice traders who are at the very beginning of their trading career.
+ If the price of an asset is decreasing but the Know Sure Thing oscillator is ascending, it is a strong signal of a bullish divergence.
+ If the price of an asset is increasing but the Know Sure Thing indicator is descending, it is a strong signal of bearish divergence.
+ However, the experts emphasize not to rely on a single indicator. The Know Sure Thing should be used in conjunction with other technical analysis tools to get accurate signals.
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