The DSS Bressert indicator was developed by Walter Bressert. It is smoother than a regular stochastic indicator but can be interpreted in generally the same way with 30 considered oversold and 70 considered overbought.
The calculations start with a normal raw stochastic. This stochastic is smoothed by an exponential moving averages before another raw stochastic is taken of the result. Then a second exponential moving average of the same period is applied to this second stochastic.
The adjustable period length can be chosen from 2 to 500. The most common settings will have a period length ranging from 5 to 30. In addition, the indicator can be smoothed in the interval from 1 to 50. Meaningful smoothing values lie in the short-term range.
The application of the DSS is comparable with that of the stochastic method. Accordingly, values above 70 or 80 must be regarded as overbought and values below 20 or 30 as oversold. A rise of the DSS above its center line should be viewed as bullish, and a fall of the DSS below its center line as bearish.