What it means
It measures much the same thing as RSI, so using both adds little.
In practice
The stochastic shows where the latest close sits within the range of the last several candles: near the top of that range or near the bottom. It moves quickly, which makes it popular for timing entries in ranges and on pullbacks.
Traders watch for it to turn up from below 20 in an uptrend's pullback, or down from above 80 in a downtrend's rally, as a sign the pullback is ending.
What to watch for
It reaches its extremes easily and stays there throughout a strong trend, producing early exit and reversal signals. It needs a trend filter or a level behind it to be useful.