The Chinese name of KDJ indicator is stochastics, which originated from the futures market. The application law of KDJ index KDJ index is three curves, which are mainly considered from five aspects in application: the absolute number of KD value; The form of KD curve; KD index crossing; Deviation of KD index; The value of the j index. Concept introduction: KDJ, full name of historical indicators, was founded by Dr. George Ryan of the United States. Its comprehensive momentum concept, strength index and the advantages of moving average are also a common technical analysis tool in European and American securities and futures markets. Stochastics's design thought and calculation formula originated from William's (W%R) theory, but it is more valuable than W%R index. W%R index is generally limited to judging the overbought and oversold phenomenon of stocks, while stochastics combines the idea of moving average to judge the buying and selling signals more accurately. It is an overbought and oversold index that fluctuates between 0- 100. It consists of three curves: K, D and J, and it combines some advantages of momentum index, strength index and moving average in design. In the calculation process, the relationship between the price level and the closing price is mainly studied, that is, by calculating the true amplitude of price fluctuations such as the highest price, the lowest price and the closing price on the same day or in recent days, the random amplitude and short-term fluctuation of price fluctuations are fully considered. Its short-term market measurement function is more accurate and effective than the moving average, and it is more sensitive than the relative strength index RSI in short-term overbought and oversold. In short, KDJ is a concept of random fluctuation, which reflects the strength of price trends and band trends, and is very sensitive to the grasp of short-term market trends.