# An Introduction to Know Sure Thing Indicator

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Friends we are here today again to discuss about "know sure thing indicator". Just as it is called a sure thing indicator, it means a know true reading indicator which you can take advantage of as a trader and measure the price momentum of the price of an asset. Let's go deeper into the discussion of what "know sure thing indicator" is all about.

Know Sure Thing

Know sure thing is an indicator that looks like a MACD indicator. Well, it is an oscillator Indicator that is used to measure the price momentum of majorly four (4) different cycles of an asset by helping you to translate the information into a single indicator. Simply put, It is a momentum oscillator Indicator that helps traders interpret the rate of change (ROC) in price data.

The reason why it is like a MACS indicator is because of the two lines with different colors that know sure thing indicator has. The lines move up and down following the price of the asset. If you look well you will see that there is a centerline in the indicator which traders usually focus on. However, since it is similar to MACD you can also use the indicator to find divergences also trend lines.

Calculation

Calculating the know sure thing indicator is very easy as all you need to look at is the weighted average of four different rates of change values that have already been smoothed. Below is the formula used for calculating the KST indicator.

Know Sure Thing = (RCMA1 X1) (RCMA2 x 2) + (RCMA3 x 3) + (RCMA4 x 4)

Where

RCMA1 = 20-period SMA of 10-period ROC
RCMA2 = 20-period SMA of 15-period ROC
RCMA3 = 20-period SMA of 20-period ROC
RCMA4 = 25-period SMA of 30-period ROC

ROC stands for Rate of change.

In KST 10-day period is the signal line which you didn't need to set or reconfigure the Indicator than using the default settings as shown in the screenshot image, as applied on the chart.

How to Use Know Sure Thing Indicator

Trend following divergencies and reversal is what most traders use the KST indicator for. Trend following is simply a strategy when you buy an asset that the price is either rising or already falling to move with the trend until it ends.

For you to use KST in trend following, you will have to first spot a currency whose price is already falling or rising, before you can apply the KST indicator on the asset.

Now after you have applied the KST indicator, you will need to look at the overall direction of the KST indicator, which is usually maintained by the price of the asset as long as the indicator is rising or falling the way the price of the asset will be rising or falling.

An exit or selling signal usually comes up when the two lines have crossed over each other. From the example in the screenshot, you will see that the asset was bullish and the KST was rising.

#### Conclusion

Today, we have so far learned what know sure thing Indicator which we are sure by now you have gotten an understanding of what know sure thing means. Note: this post is not financial or investment advice, but educational content that is written to educate you about the know-sure thing Indicator.

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