What is Stoch overbought? — chart signal explained
Stochastic asks a simple question: how close is price to the ceiling of its recent range? Using the highest and lowest prices of a recent window as the two endpoints, it converts the current close into a 0-100 position score, where values near 100 mean price is hugging the recent top.
When does it fire? — BaroBara criteria
The signal turns on when the value, calculated from the high-low range of the last 14 candles, rises above 80 — in other words, price has climbed into the top 20% of its recent range.
How traders usually read it
Above 80 is conventionally read as short-term overheating, so many traders expect a pause or a partial pullback. It's also used as a caution flag against chasing a move that has already run a long way.
What to watch out for
When an uptrend is strong, the reading can sit above 80 for extended stretches while price keeps climbing, so expecting a drop from this signal alone can fail again and again. Note that Barobara uses the raw, unsmoothed %K, so the number may differ slightly from the 'slow stochastic' shown in other charting apps.
What the data actually shows (TRX 1d)
The common reading is a drop — but what actually happened matters more. This signal has fired 71 times on TRX 1d; across the most recent 71, price reached the small target (+0.25%) first about 69% of the time. Widen the target to ±1% and it becomes about 56%. A historical probability, not a guaranteed direction — and it shifts with market regime.
Odds and expected value — with symmetric target and stop (±)
Exactly the barobara framing: which side got hit first, +X% or −X%. Target and stop are set to the same %, and the win rate is how often the upside (+X%) was reached first.
| Target = stop (±) | Win rate (+ first) | EV (before fees) |
|---|---|---|
| ±0.25% | 69% | +0.09% |
| ±0.5% | 55% | +0.05% |
| ±0.75% | 54% | +0.06% |
| ±1% | 56% | +0.12% |
| ±1.5% | 62% | +0.36% |
| ±2% | 62% | +0.48% |
Broken down by market regime
⚠️ This table uses a different basis than the symmetric (±) table above — a small +0.25% target with a wide −5.0% stop (fees included). The small target makes the win rate look high while EV is often negative — exactly what signal groups hide. And the same signal behaves differently across regimes.
| Regime | Win rate (+0.25% target) | EV (−5.0% stop) | Sample |
|---|---|---|---|
| Bear market | 93% | +0.11% | N=15 |
| Sideways | 91% | -0.15% | N=33 |
| Bull market | 78% | -0.97% | N=23 |
Recent occurrences
How far price actually moved the last few times this signal fired (MFE = maximum favorable excursion).
| Date | MFE | Result |
|---|---|---|
| 2026-04-14 | 1.2% | ✅ hit |
| 2026-04-21 | 3.99% | ✅ hit |
| 2026-05-04 | 0.97% | ✅ hit |
| 2026-05-23 | 8.43% | ✅ hit |
| 2026-06-20 | 3.61% | ✅ hit |
| 2026-07-07 | 3.01% | ✅ hit |
| 2026-07-09 | 3.16% | ✅ hit |
| 2026-07-24 | 2.24% | ✅ hit |
Strong conditions only, with past probability, sample size and validity window