Easy StochRSI (14, 5, 3)

StochRSI is indicator developed by Tushar Chande and Stanley Kroll that measures the level of RSI relative to its high-low range over a set time period. StochRSI applies the Stochastics formula to RSI values, instead of price values. This makes it an indicator of an indicator.

Using RSI values within the Stochastic formula gives traders an idea of whether the current RSI value is overbought or oversold - a measure that becomes specifically useful when the RSI value is confined between its signal levels of 20 and 80.

The StochRSI is deemed to be oversold when the value drops below 20, meaning the RSI value is trading at the lower end of its predefined range, and that the short-term direction of underlying security may be nearing a correction. Conversely, a reading above 80 suggests the RSI may be reaching extreme levels and could be used to signal a pullback in the underlying security. The StochRSI reaches these levels much more frequently than RSI, resulting in an oscillator that offers more trading opportunities. Unlike RSI, StochRSI frequently reaches the extreme 0 and 100 levels.

Easy StochRSI provides a comprehensive dashboard that allows you to view the StochRSI value of multiple instruments across 6 timeframes (M5, M15, M30, H1, H4, D1) at one glance. This provides you with an understanding of the current trend of the forex market on the go.

Key Features

☆ Timely display of StochRSI values of over 60 instruments across 6 timeframes,

☆ Allows configuration of overbought and oversold condition that best suit your personal trading strategy,

☆ Timely push notification alert when uptrend or downtrend condition is hit

☆ Display headline news of your favourite currency pair(s)

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Disclaimer/Disclosure

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Overview:

Easy StochRSI (14, 5, 3) is a technical indicator used in financial analysis to identify overbought and oversold conditions in a security's price. It is a variation of the popular Stochastic Relative Strength Index (StochRSI) indicator, with slightly different parameters.

Calculation:

The Easy StochRSI (14, 5, 3) indicator is calculated using the following steps:

1. Calculate the 14-period Relative Strength Index (RSI) of the security's closing prices.

2. Calculate the 5-period moving average of the RSI values from step 1.

3. Calculate the 3-period moving average of the values from step 2.

Interpretation:

The Easy StochRSI (14, 5, 3) indicator oscillates between 0 and 100. Generally, values above 80 indicate that the security is overbought, while values below 20 indicate that it is oversold. However, these levels can be adjusted based on the specific security and market conditions.

Trading Strategies:

Traders can use the Easy StochRSI (14, 5, 3) indicator to identify potential trading opportunities. Some common strategies include:

* Overbought/Oversold Trading: Traders can buy when the indicator falls below 20 and sell when it rises above 80.

* Crossover Trading: Traders can buy when the indicator crosses above 20 and sell when it crosses below 80.

* Divergence Trading: Traders can look for divergences between the indicator and the security's price. For example, if the price makes a new high but the indicator does not, this could indicate a potential reversal.

Advantages:

* Easy to understand and interpret.

* Can provide early warning signals of potential price reversals.

* Can be used in conjunction with other technical indicators for confirmation.

Disadvantages:

* Can generate false signals in certain market conditions.

* May not be suitable for all trading styles.

* Can be subjective in terms of overbought and oversold levels.

Conclusion:

Easy StochRSI (14, 5, 3) is a versatile technical indicator that can be used to identify overbought and oversold conditions in a security's price. It is easy to understand and interpret, but traders should be aware of its potential limitations. By combining the Easy StochRSI (14, 5, 3) indicator with other analysis techniques, traders can improve their decision-making and potentially increase their trading profits.