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.
β’ Signal confirmation - %K crossing above %D in oversold territory confirms buy signals β’ Noise reduction - Filters out false signals common in volatile markets β’ Trend validation - Rising %D confirms bullish momentum, falling %D confirms bearish momentum β’ Multi-timeframe analysis - Combine different timeframes for swing trading β’ 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
π’ 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
π΄ 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
β %K/%D crossovers at extreme levels (>0.7 or <0.3) β RSI alignment with Stochastic RSI signals β Smoothed momentum acceleration/deceleration β Volume expansion supports crossover β 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
π‘ Medium (smoothed sensitive bounces)
π΄ Low (against trend)
Downtrend
π΄ Low (against trend)
π‘ Medium (smoothed sensitive reversals)
Ranging
π’ High (reliable crossovers)
π’ High (reliable crossovers)
High Volatility
π’ High (smoothing reduces noise)
π’ High (smoothing reduces noise)
Low Volume
π΄ Low (false signals)
π΄ 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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