[blackcat] L2 SVE Stochastic RSI

14 يوليو 2022

Level 2

Background

Sylvain Vervoort’ articles in the Aug issues on 2018,“The V-Trade, Part 6”.

Function

In “The V-Trade, Part 6: Technical Analysis—Divergence Indicators” in the August 2018 issue of STOCKS & COMMODITIES, author Sylvain Vervoort introduces a modified version of the stochastic RSI, an indicator that was first introduced by Tushar Chande and Stanley Kroll. That indicator applies a stochastic calculation to an RSI value rather than a simple value, and Vervoort’s update provides additional smoothing. Vervoort uses his new indicator primarily in the analysis of divergence.

Remarks

Tradingview official stoch RSI is added for comparison.

Feedbacks are appreciated.

ملاحظات الأخبار

OVERVIEW
The [blackcat] L2 SVE Stochastic RSI indicator combines the Relative Strength Index (RSI) with a stochastic oscillator to provide a more nuanced view of market momentum. This script calculates the Stochastic RSI, which helps traders identify overbought and oversold conditions more effectively. The indicator features gradient colors for better visualization and plots clear buy and sell signals on the chart 📈💹. It is inspired by Sylvain Vervoort's work on divergence indicators published in the August 2018 issue of STOCKS & COMMODITIES.

FEATURES

Calculates Stochastic RSI using customizable parameters:
RSI Length: Period for calculating RSI.
Stochastic Length: Lookback period for stochastic calculation.
Stochastic Average Length: Period for smoothing the stochastic values.
Overbought Level: Threshold for identifying overbought conditions.
Oversold Level: Threshold for identifying oversold conditions.
Uses gradient colors to represent different levels of the Stochastic RSI visually 🌈
Plots overbought and oversold levels as circles for easy reference ⚫⚪
Displays buy ('Buy') and sell ('Sell') labels based on crossover events between the Stochastic RSI and defined thresholds 🏷️
HOW TO USE

Add the indicator to your TradingView chart by selecting it from the indicators list.
Adjust the input parameters (RSI Length, Stochastic Length, etc.) to suit your trading strategy ⚙️.
Observe the plotted Stochastic RSI line and its gradient colors to gauge market momentum.
Monitor the buy and sell labels for potential trade opportunities.
Use the overbought and oversold levels as additional context for decision-making.
LIMITATIONS

The indicator may generate false signals in highly volatile or ranging markets 🌪️.
Users should combine this indicator with other forms of analysis for more reliable trading decisions.
The effectiveness of the indicator may vary depending on the asset and timeframe being analyzed.
NOTES

Ensure that you have sufficient historical data available for accurate calculations.
Test the indicator thoroughly on demo accounts before applying it to live trading 🔍.
Customize the appearance and parameters as needed to fit your trading strategy.
In "The V-Trade, Part 6: Technical Analysis—Divergence Indicators" in the August 2018 issue of STOCKS & COMMODITIES, author Sylvain Vervoort introduces a modified version of the stochastic RSI, an indicator that was first introduced by Tushar Chande and Stanley Kroll. That indicator applies a stochastic calculation to an RSI value rather than a simple value, and Vervoort’s update provides additional smoothing. Vervoort uses his new indicator primarily in the analysis of divergence.