What is the KDJ indicator?

The KDJ indicator, also known as the random indicator, is composed of three curves: K-line, D-line and J-line. It is a medium and short-term technical indicator analysis indicator.

The KDJ indicator only judges the overbought and oversold phenomenon of the token price. In the KDJ indicator, the concept of citing the average line speed is integrated to form a more accurate basis for buying and selling signals.

According to the value of KDJ, it can be divided into oversold zone, overbought zone and hovering zone. Generally, below 20 is oversold zone, which is a buy signal. The value above 80 is overbought zone, which is a sell signal, and between 20 and 80 is a hovering zone. In addition, the value of 50 is the middle line, below 50 is weak, and above 50 is strong.

Basic Rules:

1. Below 20 is oversold; above 80 is overbought.

2. Golden Cross formed below 20 is a buy point; Death Cross formed above 80 is a sell point.

3. Two crosses formed at high level signify significant falling; two crosses formed at low level mean steep rising.

4. When the indicator shows a divergence from price, it is high time to operate.

5. When the value is around 50, don’t operate.

6. J line is not a useful indicator but can work as a signal of price falling.