Stochastics's design thought and calculation formula originated from William Theory (W&R), 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, we mainly study the relationship between the price level and the closing price, that is, by calculating the true amplitude of price fluctuations such as the highest price, the lowest price, the closing price of the day or in recent days, we fully consider the calculation of random amplitude and short-term fluctuation of price fluctuations. In short, KDJ is a concept of random fluctuation, which reflects the strength of price trends and band trends and is very sensitive to grasping the short-term trend of the market.