Stochastic RSI %D (14, 5, 3, 0)
The Stochastic RSI %D (14, 5, 3, 0) is a momentum oscillators indicator used in Skyrexio Strategy Builder for momentum analysis and overbought/oversold identification.
Introduction
The Stochastic RSI %D (14, 5, 3, 0) is a smoothed sensitive momentum oscillator that provides neutral directional bias for both LONG and SHORT opportunities. As a smoothed version of Stochastic RSI %K, it reduces noise while maintaining the enhanced sensitivity of the Stochastic RSI calculation.
How Stochastic RSI %D Works
Stochastic RSI %D is a smoothed version of StochRSI %K, calculated as a moving average to reduce noise and provide more reliable signals. The %D line acts as a signal line for %K crossovers.
• Signal confirmation - %K crossing above %D in oversold territory confirms buy signals • Noise reduction - Filters out false signals common in volatile markets • Trend validation - Rising %D confirms bullish momentum, falling %D confirms bearish momentum • Multi-timeframe analysis - Combine different timeframes for swing trading • Reliability enhancement - Smoothing reduces whipsaws while maintaining sensitivity
Key Characteristics
Category
Momentum Oscillators
Type
Smoothed Sensitive Momentum Signal
Primary Use
Noise-reduced sensitive momentum confirmation
Timeframe
All timeframes supported (1m to 1M)
Confirmation
%K crossovers, RSI alignment, volume
Strategy Applications
🟢 LONG STRATEGY (Smoothed Sensitive Recovery)
Stochastic RSI %D is neutral - use %K crossing above %D in oversold territory for LONG entries when smoothed sensitive momentum confirms upward reversal.
Base Entry Order (LONG)
Trigger Type: Once per bar close
Bar TF: 1H
First Condition: Stochastic RSI %K (14, 5, 3, 0)
Timeframe: 1H
Operator: Cross Above
Second Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
Additional Entry Orders (LONG)
Additional Entry 1: Oversold crossover confirmation
First Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
Operator: Less Than
Second Condition: Value
Value: 0.3
AND
First Condition: Stochastic RSI %K (14, 5, 3, 0)
Timeframe: 1H
Operator: Greater Than
Second Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
OR
Additional Entry 2: RSI alignment confirmation
First Condition: RSI (14)
Timeframe: 1H
Operator: Less Than
Second Condition: Value
Value: 40
AND
First Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
Operator: Greater Than
Second Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
Offset: 1
Take Profit Orders (LONG)
Rule 1: Exit condition - Overbought crossover reversal
First Condition: Stochastic RSI %K (14, 5, 3, 0)
Timeframe: 1H
Operator: Cross Below
Second Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
AND
First Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
Operator: Greater Than
Second Condition: Value
Value: 0.7
OR
Rule 2: Exit condition - Smoothed momentum peak
First Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
Operator: Greater Than
Second Condition: Value
Value: 0.8
OR
Rule 3: Exit condition - RSI momentum divergence
First Condition: RSI (14)
Timeframe: 1H
Operator: Greater Than
Second Condition: Value
Value: 70
AND
First Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
Operator: Less Than
Second Condition: Value
Value: 0.6
Stop Loss Orders (LONG)
Rule 1: Stop loss - Bearish crossover confirmed
First Condition: Stochastic RSI %K (14, 5, 3, 0)
Timeframe: 1H
Operator: Cross Below
Second Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
OR
Rule 2: Stop loss - Smoothed momentum breakdown
First Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
Operator: Less Than
Second Condition: Value
Value: 0.1
AND
First Condition: Volume
Timeframe: 1H
Operator: Greater Than
Second Condition: Simple Moving Average (20)
Timeframe: 1H
OR
Rule 3: Stop loss - RSI breakdown confirmation
First Condition: RSI (14)
Timeframe: 1H
Operator: Less Than
Second Condition: Value
Value: 25
🔴 SHORT STRATEGY (Smoothed Sensitive Reversal)
Stochastic RSI %D is neutral - use %K crossing below %D in overbought territory for SHORT entries when smoothed sensitive momentum confirms downward reversal.
Base Entry Order (SHORT)
Trigger Type: Once per bar close
Bar TF: 1H
First Condition: Stochastic RSI %K (14, 5, 3, 0)
Timeframe: 1H
Operator: Cross Below
Second Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
Additional Entry Orders (SHORT)
Additional Entry 1: Overbought crossover confirmation
First Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
Operator: Greater Than
Second Condition: Value
Value: 0.7
AND
First Condition: Stochastic RSI %K (14, 5, 3, 0)
Timeframe: 1H
Operator: Less Than
Second Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
OR
Additional Entry 2: RSI alignment confirmation
First Condition: RSI (14)
Timeframe: 1H
Operator: Greater Than
Second Condition: Value
Value: 60
AND
First Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
Operator: Less Than
Second Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
Offset: 1
Take Profit Orders (SHORT)
Rule 1: Exit condition - Oversold crossover reversal
First Condition: Stochastic RSI %K (14, 5, 3, 0)
Timeframe: 1H
Operator: Cross Above
Second Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
AND
First Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
Operator: Less Than
Second Condition: Value
Value: 0.3
OR
Rule 2: Exit condition - Smoothed momentum trough
First Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
Operator: Less Than
Second Condition: Value
Value: 0.2
OR
Rule 3: Exit condition - RSI momentum divergence
First Condition: RSI (14)
Timeframe: 1H
Operator: Less Than
Second Condition: Value
Value: 30
AND
First Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
Operator: Greater Than
Second Condition: Value
Value: 0.4
Stop Loss Orders (SHORT)
Rule 1: Stop loss - Bullish crossover confirmed
First Condition: Stochastic RSI %K (14, 5, 3, 0)
Timeframe: 1H
Operator: Cross Above
Second Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
OR
Rule 2: Stop loss - Smoothed momentum breakout
First Condition: Stochastic RSI %D (14, 5, 3, 0)
Timeframe: 1H
Operator: Greater Than
Second Condition: Value
Value: 0.9
AND
First Condition: Volume
Timeframe: 1H
Operator: Greater Than
Second Condition: Simple Moving Average (20)
Timeframe: 1H
OR
Rule 3: Stop loss - RSI breakout confirmation
First Condition: RSI (14)
Timeframe: 1H
Operator: Greater Than
Second Condition: Value
Value: 75
Advanced Strategy Combinations
Smoothed Sensitive Divergence Strategy
Enhanced Divergence Detection:
Price: Makes new high/low
Stochastic RSI %D: Smoothed momentum fails to confirm
RSI: Regular RSI confirms divergence
Crossover: %K crosses %D in opposite direction
Triple Confirmation Strategy
Multi-Timeframe Smoothed Sensitive Analysis
Risk Management Guidelines
Position Sizing
LONG Strategy
Standard
%K crosses above %D in oversold
SHORT Strategy
Standard
%K crosses below %D in overbought
Triple Confirmation
Increased
All three indicators align
Divergence Plays
Reduced (75%)
Counter-trend momentum signals
Stochastic RSI %D Reliability Factors
✅ %K/%D crossovers at extreme levels (>0.7 or <0.3) ✅ RSI alignment with Stochastic RSI signals ✅ Smoothed momentum acceleration/deceleration ✅ Volume expansion supports crossover ✅ Clear divergence patterns with confirmation
Best Practices
For LONG Strategies
Oversold crossovers - Wait for %K to cross above %D below 0.3
RSI alignment - Confirm with regular RSI oversold conditions
Smoothed confirmation - Ensure %D is turning upward
Volume validation - Confirm crossovers with volume expansion
For SHORT Strategies
Overbought crossovers - Wait for %K to cross below %D above 0.7
RSI alignment - Confirm with regular RSI overbought conditions
Smoothed confirmation - Ensure %D is turning downward
Volume validation - Confirm crossovers with volume expansion
Common Mistakes to Avoid
Middle range crossovers - Trading %K/%D crossovers between 0.3-0.7
No RSI confirmation - Ignoring regular RSI alignment
Volume ignored - Missing volume validation of crossover signals
Smoothing ignored - Not considering %D momentum direction
Market Conditions Analysis
Uptrend
🟡 Medium (smoothed sensitive bounces)
🔴 Low (against trend)
Downtrend
🔴 Low (against trend)
🟡 Medium (smoothed sensitive reversals)
Ranging
🟢 High (reliable crossovers)
🟢 High (reliable crossovers)
High Volatility
🟢 High (smoothing reduces noise)
🟢 High (smoothing reduces noise)
Low Volume
🔴 Low (false signals)
🔴 Low (false signals)
Related Indicators
Conclusion
Key Takeaways
PRIMARY USE: Smoothed sensitive momentum confirmation through %K/%D crossovers
SECONDARY USE: Noise reduction while maintaining enhanced sensitivity
ALWAYS: Confirm crossovers at extreme levels with RSI alignment and volume
NEVER: Trade middle-range crossovers without triple confirmation
Success with Stochastic RSI %D requires understanding its role as a smoothed version of the sensitive Stochastic RSI %K. The key is waiting for %K/%D crossovers at extreme levels, confirming with regular RSI, and validating with volume expansion.
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