How can I Get More Signals from RSI?

Traders can speed up to RSI by using Stochastics RSI, or StochRSI. In their 1994 book, The New Technical Trader, Tushard Chande and Stanley Kroll explain that RSI can oscillate between 80 and 20 for extended periods without reaching extreme levels. Notice that 80 and 20 are used for overbought and oversold instead of the more traditional 70 and 30. Traders looking to enter a stock based on an overbought or oversold reading in RSI might find themselves continuously on the sidelines. Chande and Kroll developed StochRSI to increase sensitivity and generate more overbought/oversold signals.

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Basically, StochRSI is the Stochastic Oscillator applied to RSI. The chart above shows RSI in red and the Stochastic Oscillator (14,1,1) in black. The Stochastic Oscillator is added as an indicator to RSI using the "advanced options" on SharpCharts. The bottom indicator window shows StochRSI. Notice how StochRSI exactly matches with the Stochastic Oscillator of RSI. StochRSI is measuring the momentum of momentum. More importantly, there are many more overbought and oversold signals. For more, see our ChartSchool article on StochRSI.
Arthur Hill
About the author: , CMT, is a Senior Technical Analyst at He has written articles for numerous financial publications including Barrons and Stocks & Commodities magazine. Focusing predominantly on US equities and ETFs, his systematic approach of identifying trend, finding signals within the trend, and setting key price levels has made him an esteemed technician. In addition to his CMT designation, Arthur holds an MBA from the Cass Business School at City University in London. Learn More
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