What are Phantom Greens in the Stochastic?

[tasty]

Hi,

In posts and comments on Phil's website, there is talk of phantom green signals.

I get the impression that these are discussed in his seminars, but are not covered in the book or clarified on the website.

Does anyone know what these are?

My suspicion is they are singals from %D crossing %K that lack the %K oversold/overbought confirmation.

Many Thanks
Tasty

[Justin]

I don't know quite as much about the stochastic indicator when using a fastline/slow line, I stick to a little bit more basic form of the indicator. Based on what I do think I understand, here is an example of a phantom/ghost green:




Notice the small green circle I have drawn. Clearly, a reversal in the short term trend, but it took place before it broke through the 25 line. Had the reversal occured below the 25 line, you would have seen a green arrow plotted. The same logic would apply with a bearish reversal that occured before breaking through the 75 line.

More reason to remember that the indicators only indicate, they do not dictate.

Hopefully someone else can bridge the gap and apply a similar understanding for those who prefer fastline/slow line stochastic indicators. You might also refer to this thread for some additional information on the stochastics: http://www.roicommunity.com/forum/te...indicator.html