What is Stochastic RSI?
The Stochastic Relative Strength Index, abbreviated as StochRSI, is a technical analysis indicator used to determine whether an asset is overbought or oversold, and also to determine the current market dynamics. As the name suggests, the StochRSI is a derivative of the Standard Relative Strength Index (RSI) and is therefore considered to be an index capable of measuring indices. It is an oscillator that fluctuates above and below the center line. StochRSI was originally described in a 1994 book entitled The NewTechnical Trader by Stanley Kroll and Tushar Chande. It is often used by stock traders and is also applicable to other trading environments such as the forex and cryptocurrency markets. How does StochRSI work? The StochRSI is generated from the standard RSI by applying the Stochastic Oscillator Generation formula.The generated result is a single numeric rating that oscillates up and down around the center line (0.5) over a value range of 0–1. However, a modified version of ...