Principle and calculation method of KDJ index
First, the principle of KDJ index
The stochastic indicator KDJ generally calculates the immature random value RSV of the last calculation period through the highest price, the lowest price and the closing price of the last calculation period in a specific period (usually 9 days, 9 weeks, etc.). ) and the proportional relationship between them, and then calculate the K value, D value and J value according to smma method, and draw a graph to judge the stock trend.
Random indicator KDJ is a point formed by calculating the highest price, lowest price and closing price, and connecting the obtained K value, D value and J value with countless such points to form a complete KDJ indicator that can reflect the price fluctuation trend. It is a technical tool that mainly uses the real amplitude of price fluctuation to reflect the strength of price trend and the phenomenon of overbought and oversold, and sends out buying and selling signals before the price rises or falls. In the design process, the relationship between the highest price, the lowest price and the closing price is mainly studied, and some advantages of the concept of momentum, power index and moving average are also integrated, so the market can be judged quickly, quickly and intuitively.
Stochastics KDJ first appeared in the form of KD index, which was developed on the basis of William index. However, William indicator only judges the overbought and oversold phenomenon of stocks, while KDJ indicator integrates the concept of moving average speed, forming a more accurate basis for buying and selling signals. In practice, K-line and D-line cooperate with J-line to form KDJ index. Because KDJ line is essentially a concept of random fluctuation, it is more accurate to grasp the short-term trend of the market.
Second, the calculation method of KDJ index
The calculation of KDJ index is very complicated. First of all, we have to calculate the RSV value of the period (n days, n weeks, etc. ), that is, the immature random index value, and then calculate the K value, D value, J value, etc. Taking the calculation of daily KDJ value as an example, the calculation formula is as follows
Rsv for n days = (cn-ln) ÷ (HN-ln) ×100.
In the formula, Cn is the closing price on the nth day; Ln is the lowest price in n days; Hn is the highest price for n days. The RSV value always fluctuates between 1 and 100.
Secondly, calculate the values of k and d:
K value of the current day = 2/3× K value of the previous day +65438+ 0/3× RSV of the current day.
D value of current day = 2/3× D value of previous day +65438+ 0/3× K value of current day.
If there is no K value and D value of the previous day, you can use 50 instead.
Take the KD line with a period of 9 days as an example. First, the RSV value of the last 9 days, that is, the immature random value, should be calculated, and the calculation formula is as follows
No.9 RSV = (C-L9) ÷ (H9-L9) × 100
In the formula, C is the closing price on the 9th day; L9 is the lowest price in 9 days; H9 is the highest price in 9 days.
K value = 2/3× K value of the previous day +65438+ 0/3× RSV of the current day.
D value = 2/3× K value of the previous day +65438+ 0/3× K planting of the current day.
If there is no K value and D value of the previous day, you can use 50 instead.
J value =3* K value of the day -2* D value of the day.
Third, the application principle:
KDJ stochastic index is sensitive and fast, which is a good technical index for short-term, medium-term and long-term trend band analysis. Generally speaking, for people with large funds and large bands, the KDJ value of the month is gradually absorbed when it is low; When the main force operates at ordinary times, it pays attention to the position of weekly KDJ and judges the high and low points of the mid-line band, so the daily KDJ is often passivated unilaterally; Daily KDJ is extremely sensitive to the direction of stock price changes and is an important method of daily trading. For short-term travelers in small bands, 30 minutes and 60 minutes KDJ are important reference indicators; 5 minutes and 15 minutes KDJ can provide the best time for investors with designated trading plans to place orders immediately.
The default parameter commonly used by KDJ is 9. As far as my personal experience is concerned, the short-term parameter can be changed to 5, which not only makes the response more agile, rapid and accurate, but also reduces the passivation phenomenon. Commonly used KDJ parameters are 5, 9, 19, 36, 45, 73, etc. In actual combat, different periods should also be comprehensively analyzed, and the short, medium and long trends should be clear at a glance. If * * * vibration occurs in different periods, the reliability of the trend will increase. There are four main points in the actual judgment of KDJ indicators:
1) K line is the quick confirmation line-the value above 90 is overbought, and the value below 10 is oversold;
Line D is a slow trunk line-the value above 80 is overbought and the value below 20 is oversold;
J-line is a direction sensitive line. When the j value is greater than 100, especially for more than 5 consecutive days, the stock price will at least form a short-term head, while when the j value is less than 0, especially for more than several consecutive days, the stock price will at least form a short-term bottom.
2) When the value of k is gradually greater than the value of d, the graph shows that the K line crosses the D line from below, indicating that the current trend is upward, so when the K line crosses the D line graphically, it is a buy signal.
In actual combat, when the K line and the D line cross below 20, the signal of short-term buying is more accurate at this time; If the K value is below 50, the D value crosses from bottom to top twice, forming a "W bottom" shape with the right bottom higher than the left bottom, and the stock price may have a considerable increase in the afternoon.
3) When the value of k is gradually less than the value of d, the graph shows that the K line crosses the D line from above, indicating that the current trend is downward, so when the K line crosses the D line downward on the graph, it is a sell signal.
In actual combat, when the K line and the D line cross downward above 80, the short-term selling signal at this time is more accurate; If the value of K is above 50 and the value of D breaks down from top to bottom twice, forming an "M-head" shape with the right head lower than the left head, the stock price may drop considerably in the afternoon.
4) It is also a practical method to judge the top and bottom of the stock price by the trend of KDJ deviating from the stock price:
A) The stock price has reached a new high, but the KD value has not reached a new high, which belongs to the top deviation and should be sold;
B) the stock price is low, but the KD value is not low, which belongs to the bottom deviation and should be bought;
C) The stock price has not reached a new high, but the KD value has reached a new high, which belongs to the top deviation and should be sold;
D) the stock price is not low, but the KD value is low, which belongs to the bottom deviation and should be bought;
It should be noted that the method of judging the deviation between the top and bottom of KDJ can only be compared with the KD value of the previous wave of high and low points, and can not be compared by jumping over.
Fourth, the application experience:
1) In practice, some short-term customers, who are short, flat and quick, often use the minute indicator to judge the market outlook and decide the trading opportunity. In T+0 era, 15 minutes and 30 minutes KDJ indicators are commonly used, and in T+ 1 era, 30 minutes and 60 minutes KDJ are used to guide entry and exit. Several rules of thumb are summarized as follows:
A) If the KDJ is consolidating below 20 for a long time in 30 minutes, so is the KDJ in 60 minutes. Once the K value crosses the D value and crosses 20 in 30 minutes, it may trigger an upward trend lasting for more than 2 days; If the daily KDJ indicator is also at a low level, it may be an intermediate market. However, it should be noted that it is only effective when the K value is greater than 20% of the D value after the intersection of the K value and the D value.
B) If KDJ turns head down above 80 in 30 minutes, and K is below D, it will fall below 80 minutes, and KDJ just crosses 20 in 60 minutes, less than 50, indicating that the market will turn head back, and KDJ may continue to rise after bottoming out in 30 minutes;
C) If the KDJ is above 80 in 30 minutes and 60 minutes, and the K value crosses the D value at the same time after a long period of consolidation, it indicates that it is necessary to start the downward adjustment of the market for at least 2 days;
D) If the KDJ falls below 20 in 30 minutes and turns upward, and the KDJ is still above 50 in 60 minutes, it is necessary to observe whether the K value will effectively cross the D value within 60 minutes (the K value is more than 20% of the D value), and if it is effective, start a new round of upswing; If it is invalid, it means that it is only a rebound in the process of falling, and it will continue to fall after the rebound;
E) If KDJ stops falling before 50 in 30 minutes, and KDJ just crosses upward in 60 minutes, it means that the market may continue to rise again, and it is only retreating at present;
F) KDJ deviates in 30 minutes or 60 minutes, which can also be used as a basis for judging the top and bottom of the market. For details, please refer to the previous discussion on daily deviation;
G) In the super-strong market, the KDJ can reach more than 90 in 30 minutes, and the high position repeatedly appears invalid crossover. At this time, we should focus on the 60-minute KDJ. When KDJ crosses down in 60 minutes, it may lead to a short-term deep retreat;
H) During the plunge, KDJ can approach 0 in 30 minutes, but the general trend is still declining. At this time, we should also look at KDJ in 60 Minutes. When KDJ effectively crosses within 60 minutes, it will trigger a strong rebound.
2) When the market is in a very strong and weak unilateral market, the daily KDJ is repeatedly passivated, and the medium and long-term indicators such as MACD should be used instead; When the stock price fluctuates greatly in the short term and the daily KDJ response lags behind, CCI, ROC and other indicators should be used instead; Or use SLOWKD slow indicator;
3) The weekly KDJ parameter is generally 5, and the weekly KDJ index has obvious prompting effect on bottoming and peaking. Accordingly, band operation can save a lot of hard work and strive for maximum profit. Need to be reminded that the weekly J value generally rises at the V-shaped single bottom in the oversold area, indicating that it is only a rebound market, and the formation of a double bottom is a reliable intermediate market; However, the J value may drop sharply at the top of the overbought area. At this time, we should be vigilant and judge comprehensively with other indicators. However, when the stock market is in a bull market, the stock price will still rise sharply after the J value is overbought for a period of time.