Stochastic RSI: What Is It and How Does It Work?
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Bitcoin is rewriting history in terms of valuations, breaking the resistance of $30,000 as of this writing (June 28, 2023). The recurring growth in Bitcoin and altcoins has spurred an army of new traders ready to dive into crypto trading. While most traders jump straight into the action, it’s always worthwhile to understand technical indicators and tools that can strategize your entry and exit points for each trade. Stochastic RSI is one such indicator, allowing traders to identify market trends.
Let’s take a granular look at this technical indicator and its utility in crypto trading.
Key Takeaways:
Stochastic RSI was introduced to increase sensitivity to price volatility, in order to more accurately determine an asset’s overbought and oversold levels.
It uses the foundations of both stochastic and RSI indicators, which adjust to the historical performance of an asset to measure the level of RSI relative to the price movement over a period of time.
The stochastic RSI indicator is ideal intraday trading and swing trading tool for volatile trading assets such as Bitcoin.