StochRSI: Stochastics applied to Relative Strength Index values
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There are no “get-rich-quick” schemes in stock trading, no matter what anyone tries to sell you. In order to make it, you have to do your research, learn, make mistakes, learn from those mistakes, and continually build on your knowledge.
Similarly, there’s no way to “learn it all” about stock trading in one day, one month, or even one year. What you need to do is keep on learning, constantly adding to your trading repertoire. Mastering technical analysis is a lot like putting together an intricate puzzle, and sometimes you need to know X before you can understand Y, Z before you can understand X, etc.
A good example is the StochRSI indicator, which combines Stochastics and RSI — two subjects we dealt with independently, in episodes 13 and 10, respectively. Putting those two powerful indicators together gives you something all the more powerful, and in this episode, StochRSI is explained.
In this episode, you’ll learn:
- About Stochastics and RSI on their own (brief review) (0:40)
- How StochRSI came into being — and why its origins are important (1:12)
- The problem with regular RSI and the big advantage of StochRSI (1:40)
- How to calculate StochRSI — you’ll never need to do it, but it is helpful to understand how it’s calculated (2:11)
The video also contains information on how to interpret StochRSI, examples of stock charts with StochRSI, how to use StochRSI on StockCharts.com, and more!
In conclusion, StochRSI may not be the easiest to calculate, but when you get to the root of it, it’s pretty easy to understand. Thanks to the Internet, you’ll never need to do the calculations yourself, so what’s to stop you from using StochRSI? Nothing but your lack of understanding — which can be remedied by watching this video.
Happy Trading!
Manny Backus
CEO, Wealthpire Inc.
P.S. Next week we’ll look at TRIX — and I’m not talking about the fruity kids’ breakfast cereal. In fact, this particular TRIX isn’t for kids: it is for traders who want to make big profits! Tune in next week.
Episode 54 – StochRSI Stochastics applied to Relative Strength Index values
