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Calculation: DV Super Smoothed Double Stochastic Oscillator

September 11, 2009

Hi all,  Corey Rittenhouse of Catallactic Analysis has been kind enough to test out some strategy variations on the DV Stochastic using the S&P500.  The combo strategy is very interesting. I forwarded him an example spreadsheet for the exact calculation of the indicator to post on his site. http://www.catallacticanalysis.com/strategytests/differentstrategyvariationsDVSSDStochastic.php

To calculate the double stochastic oscillator take the following steps:

1) take the stochastic of the last 10 days including high, low, and close data calculated as (today’s close- min(last 10 days HLC))/(max(last 10 days HLC)-min(last 10 days HLC))

2) take the stochastic of the number calculated in step 1, in this case (stochastic-min(stochastic last 10 days))/(max(stochastic last 10 days)-min(stochastic last 10 days))

3) take the 3 period (day) average of this result for the first smoothing

4) take .85 x the first smoothed value + .15 x the previous day’s smoothed value for to get the final result

The resulting stochastic is smooth and very responsive to the cycles that occur in the S&P500. Good luck!

12 Comments leave one →
  1. September 11, 2009 7:04 pm

    Very cool David, can you tell me if HLC is referring to (H+L+C)/3 ? Also not sure where DV is derived – looking for (C/((H+L)/2). And are there two lines in the final indicator – from steps 2 and 4? Thanks!

    • david varadi permalink*
      September 11, 2009 8:22 pm

      hi, don’t confuse this with the DV, that is just a branding thing. Essentially take the stochastic of all three rows of data going back 10 days (H, L, and C). Then take the 10-day stochastic of this, and then smooth it twice according to instructions

      cheers
      dv

  2. shay permalink
    September 13, 2009 7:06 am

    Hello.
    I didn’t quite understand the functions of calculation.
    Can you explain it with more details?

    • david varadi permalink*
      September 13, 2009 6:00 pm

      hi please send me an email and i can send you a spreadsheet example
      dv

  3. MikeS permalink
    September 13, 2009 8:57 pm

    How is this used? If you ultimately have just one result (from step 4, identified as the final result), what are you looking for? (Above/below .8/.2?) Or do you retain the result from more than just step 4, presumably to have lines that cross?

    • david varadi permalink*
      September 13, 2009 11:17 pm

      hi mike, this can be used just like a normal stochastic, note that the performance was very good just simply buying below .5 and selling above .5. However I would recommend buying below .3 or .2 and selling above .5 most of the position and part of it above .8.

      dv

  4. shay permalink
    September 14, 2009 8:59 am

    david varadi :hi please send me an email and i can send you a spreadsheet exampledv

    Hello. My email is shay.farber@gmail.com
    thanks.

  5. pankaj agrawal permalink
    November 16, 2009 9:49 pm

    david varadi :hi please send me an email and i can send you a spreadsheet exampledv

    Hi,
    My E-Mail is pra1968@yahoo.com

  6. vinod malhotra permalink
    April 1, 2010 8:23 am

    kindly send me an example of double stoch in excel spreadsheet
    thnx

  7. Emiliano permalink
    August 7, 2012 5:01 am

    Hi. My name is Emiliano. Can you please send the spreadsheet example of the double stochastic. Thanks. My email is: emil324@hotmail.com.

  8. ian permalink
    April 17, 2014 1:17 am

    please send the spreadsheet example of the double stochastic. Thanks. My email is: mrprofit88@yahoo.com

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