# The Strategy Of Trading In Cryptocurrencies Using Stochastic For 60 Seconds

Stochastic is a classic indicator of technical analysis related to the class of oscillators. When calculating its readings, the speed of the price movement and its intensity are taken into account. It’s carried out by correlating the coefficient of price divergence from the closing exchange rate of the previous time period. Without going into the mathematical intricacies of the calculation formula, we can say that the stochastic indicator shows the current strength of the active price trend. It allows traders to build forecasts, relying on the very probability of a price reversal at a certain point of time.

The indicator consists of two lines that move within the area with levels from 0 to 100, providing signals of three types. First, it’s the position of the two moving averages relative to the levels on the area. Stochastic, like RSI, has its overbought and oversold zones. They’re usually at the level of 80 and 20. Secondly, it’s the position of the moving averages relative to each other: it’s crucial which of the lines is on top, which is below. Thirdly, the distance between moving averages: a large interval indicates high volatility, while a smaller one stands for a decrease in activity in the market.

## Configure the trading terminal

Stochastic appears to be a universal tool that can be used for analysis of any assets and timeframes. However, for turbo options for 60 seconds, you’d better use a crypto-index (__are cryptocurrencies a scam?__). In terms of technical analysis CRYPTO IDX allows you to get an ideal price chart. The minimum allowable interval is 15 seconds, which enables to build effective forecasts for turbo options for 60 seconds.

To trade in digital coins using this strategy you will need to select CRYPTO IDX, set the timeframe of the chart for 15 seconds, add Stochastic with the default settings (period 14, 80/20 levels).

## The signal for the purchase of the UP option

The basic signals of the stochastic indicator are treated unambiguously. As soon as both moving averages cross the oversold zone (below 20), you should buy the UP option. In this case, the white line should be higher than the red one, and it should be at a short distance from it, without getting entangled. It’s a signal to reverse the downtrend.

The more frequent moving averages get entangled on the eve of the signal, the less likely it will be. Ideally, on the eve of the stochastic entrance to the reversal zone (20/80) and the subsequent exit from it, the moving averages don’t interlace each other, but run parallel to each other at an equal distance.

## The signal to buy the DOWN option

The Stochastic signal to buy the DOWN option is the exit of the moving averages from the overbought area, located at a level above 80. In the case the white moving average falls below the red one. You need to enter the market on the reversals of trends, neglecting periods of short-term correction.

The rules of choosing expiration dates are standard and they’re determined depending on the interval on the chart. The duration of the transaction should be 3-5 candles. You shouldn’t trade when the market is flat.

## An example of crypto trading using Stochastic

It’s very easy to open trading positions using this oscillator. Any newcomer will undoubtedly cope with it. The given method is simple, but at the same time very effective, but on the condition that you trade in a volatile market. In order to solidify your newly-acquired knowledge and confirm the whole potential of this oscillator, we will conduct one expository deal.

Asset: CRYPTO IDX.

Interval: 15 seconds.

Expiration: 1 minute.

Here we trade using a real deposit.

On the chart, we see a reversal of the upward trend. At the time of receiving the signal, once the moving averages have crossed the 80 boundary, we enter the market with the DOWN option. The moment of opening the trading position is seen on the screenshot above, which was made in 30 seconds.

In the picture above, the moment of option expiration is recorded. The trading position is closed, the profit on our trade deposit accounts for 80%. CRYPTO IDX boasts a high percentage of returns, regardless of the time of day, which is another advantage of this particular asset.

## Conclusion

In February of this year, the broker Binomo added up to 5 new indicators to its site, including Stochastic. It opens a new horizon of opportunities for traders who conduct technical analysis directly in the trading terminal, which enables to use turbo options. In this article we have considered the classical trading scheme for this indicator. However, the real potential of this oscillator is much higher. On its basis, dozens of effective strategies have been developed. We are going to review them on our website.

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