Category: Advanced Indicator Set 2
Input parameters
Name
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Setting
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Default
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Input
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Time Series
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Close
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Period
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Integer >= 2
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5
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Calculations
The Stochastic Relative Strength Index (RSI) Oscillator, suggested by Chande and Kroll (see reference below), is defined as:
StochasticRSI = (RSI current - RSI lowest) / (RSI highest – RSI lowest)
Here, RSI is the classic J. Welles Wilder’s relative strength index. RSI lowest and RSI highest are the lowest and highest values of RSI over Period most recent bars.
Discussion
Stochastic RSI values range from zero to +1, where zero corresponds to RSI at its minimum, and +1 corresponds to RSI at its maximum in the lookback Period. The Stochastic RSI oscillator can be used to identify overbought/oversold markets. Overbought signals are near +1, and oversold signals are near zero.
References
Chande, Tushcar and Kroll, Stanley, “Stochastic Rsi and Dynamic Momentum Index”, Technical Analysis of Stocks & Commodities, v.11:5 (189-199)
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