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Definition of 'K-Ratio'

The K-Ratio is a technical analysis indicator that measures the relationship between a stock's price and its moving average. It is calculated by dividing the stock's price by its 50-day moving average.

A high K-Ratio indicates that the stock is overbought, while a low K-Ratio indicates that the stock is oversold. The K-Ratio can be used to identify potential trading opportunities by looking for stocks that are trading at extreme levels of either overbought or oversold.

The K-Ratio is a momentum indicator, which means that it measures the speed at which a stock's price is moving. Momentum indicators are often used to identify trends and reversals.

The K-Ratio is often used in conjunction with other technical indicators, such as the moving average convergence divergence (MACD) and the relative strength index (RSI).

The K-Ratio can be a useful tool for technical analysis, but it is important to remember that it is only one indicator and should not be used in isolation. Other factors, such as fundamental analysis, should also be considered when making investment decisions.

Here are some additional details about the K-Ratio:

* The K-Ratio was developed by Donald Lambert in the 1950s.
* The K-Ratio is also known as the stochastic oscillator.
* The K-Ratio can be used to identify potential trading opportunities in both bull and bear markets.
* The K-Ratio is a relatively simple indicator to use, but it can be effective in identifying potential trading opportunities.

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