In financial technical analysis, the know sure thing (KST) oscillator is a complex, smoothed price velocity indicator developed by Martin J. Pring. A rate of change (ROC) indicator is the foundation of KST indicator. KST indicator is useful to identify major stock market cycle junctures because its formula is weighed to be more greatly influenced by the longer and more dominant time spans, in order to better reflect the primary swings of stock market cycle. The concept behind the oscillator is that price trends are determined by the interaction of many different time cycles and that important trend reversals take place when a number of price trends are simultaneously changing direction. Formula Four different rates of change are calculated, smoothed, multiplied by weights and then summed to form one indicator. http://search.cpan.org/~kmx/Finance-TA-v0.4.1/TA.pod#TA_ROC_(Rate_of_change_:_((price/prevPrice)-1)*100) Where price refers to current closing price and price(X1) refers to the closing price X1 bars ago. Where MOV(ROC1,AVG1) refers to the AVG1 day moving average for ROC1 For short-term trends, Martin J Pring suggests the following parameters: X1 = 10 X2 = 15 X3 = 20 X4 = 30 AVG1 = 10 AVG2 = 10 AVG3 = 10 AVG4 = 15 W1 = 1 W2 = 2 W3 = 3 W4 = 4 The formula is built into, or can be included in, various technical analysis software packages such as MetaStock or OmniTrader. Implications Entry rules KST Indicator When KST crosses below its 9-day exponential average, short at the next day opening price. Exit rules KST indicator When KST crosses above its 9-day exponential average, close short position at the next day opening. Variations It can be calculated on daily or long term basis. The dominant time frame in the (KST)'s construction is a 24-month period, which is half of the 4-year business cycle. This means that the KST will work best when the security in question is experiencing a primary up- and downtrend based on the business cycle. KST interpretation KST can be interpreted in the ways mentioned below. The dominant time frame in the Know Sure Thing (KST)'s construction is a 24-month period, which is half of the 4-year business cycle. This means that the Know Sure Thing (KST) will work best when the security in question is experiencing a primary up- and downtrend based on the business cycle. Directional changes and moving average crossovers The average to use is a simple 10-day moving average. It