Rsi forex strategies

December 12, by TradingStrategyguides Comments. Thanks for checking out the Trading Strategy that strategies the RSI indicator, and price action analysis to land you great trade entries! If you want the Free RSI pdf trading strategy guide to this Strategy tap here and we will give it to you for FREE.

We also will discuss an indicator we have developed that uses this rsi to give you easy entries and exit points. This strategy forex identify a break of a trend and take advantage of the movement to the opposite direction.

Kind of like our Trend Breaker Strategy. In this article, I am going to be showing you a simple trading strategy using the RSI indicator. You are going to benefit from this strategy by learning to trade divergence, and find rsi low risk way to sell near the top or buy near the bottom of a trend.

The RSI indicator is one of the most popular indicators used by traders in any market stocks, forex, futures, options. What is the RSI Relative Rsi Indicator?

This indicator was developed by Welles Wilder around when it quickly became one of the most popular oscillator indicators for traders in financial markets.

This momentum indicator can strategies between 0 and providing overbought and oversold signals. The formula for this indicator is a bit complex:. I could explain this whole process to you, however, I will spare you the details. I just wanted to share this with the mathematicians that are reading this who enjoy seeing equations. You can do a quick google search if you would like to strategies more about this. The default settings for this indicator is a smoothing period of We are going to change that setting to 8.

Make sure you change this setting before you jump into this strategy. The reason I like 8 rather than 14, is that the RSI will be much more responsive for us which is very important when are looking for overbought or oversold price areas. Also go ahead into the RSI setting and change the lines in the indicator to 80, You will learn more about this later. This indicator will be the only indicator we use for this strategy. The reason we only use this, forex because we have a strict set of rules we need to follow before we can enter a trade.

And these rules will, without a doubt, validate a reversal for us to enter a trade. This indicator comes standards on mostly all trading platforms. You just need to make these adjustment to this. Find the strategies pair that is showing a high the last 50 candlesticks. OR low depending on the trade. The reason for that, is that there are reversals of trends in every time period.

So this can be a swing trade, day trade, or a scalping trade. As long as it follows the rules it is a valid trade. The only thing we need to make sure of in this current step is that it is the low or the high the last 50 candles.

This is a USDCHF strategies pair and will be a BUY trade. This is not necessary but may be helpful for you to do and see how strong the trend is.

When we find 50 candle low, it needs to be coupled with RSI reading 20 or lower. Once we see that we had a low, the last 50 candles AND the RSI is BELOW 20 then we can move on the the next step.

Remember that this strategy is a reversal strategy. It is going to be forex the current trend and moving the other direction. Wait rsi a second price low candle to close after the first one that we already identified. The second price low must be below the first low but the RSI indicator must provide a higher signal than the first one. If the price forex making higher highs, the oscillator should also be making higher highs.

If price is making lower lows, the oscillator should also be making lower lows. We have rules in place that will capitalize on this divergence, so that we can make a great profit. Keep in mind, that this step may take a bit to develop. It is very important to wait for this second low because it get you in a better position to make a trade. Remember, that our example is a current downtrend looking to break to the upside. If this was a 50 candle high we would be looking for the exact opposite with this step.

Once this criteria has been met we can strategies ahead and look for an entry because the forex are showing us that a reversal is soon coming. You wait for the price to head in the direction of the trade and wait for a candle to close above the first forex that you identified that was previous strategies candle low.

Save this picture for reference, if are struggling with this step. This will guide you when you rsi for a trade. To place your stop bump back time periods and find a good level to rsi your stop forex makes logical sense.

So you are looking for prior resistance, support. We placed our stop below this support area. That way if the trend continued and did not break it could hit this level and bounce back up in our direction. I recommend you follow at least a 1 to 3 profit vs. This will ensure that you are maximizing your potential to get the most out of this strategy.

You can adjust as you wish, but most good strategies that identify breaks of a forex use a 1 to 3 profit vs. If you have a questions or comments about this trading strategy you may reach us at info tradingstrategyguides. Check out the EFC Indicator we developed that trades the RSI strategy for you!

For this strategy trading strategy, what is the best time frame use to calculate 50 candle strategies the step. Please i need your advise. For the strategy, i did use my own strategy by changing the indicator setting. I am using 2 rsi setting5 and maintain the 14 period. I add in the level from 70,60,50,40 and The 5 period mark yellow and 14 mark blue.

The 5 period will show the entry buy or sell when crossing the 14 from bottom or rsi. Again the level forex and 40 will indicate to open buy or sell. I just add in to my chart the currency strength power indicator and make a decision to enter trade base on the current strength. But your strategy is something additional knowledge to me and many thanks to you for this strategy and can be very useful in my daily trade.

In my point of view the most important feature of the indicator is to predict with high percentage of accuracy of the reversal point or zone either rsi bought or over sold. I really think that this indicator will be extremely valuable because in my experience reversals are one of my most profitable trades and I it can be a real pain trying to find it on the charts, this strategies exactly what I have been looking for. Its always strategies pleasure hearing from a professional trader!

An indicator which shows the supply and demand zones in all timeframes but especially the longer ones would really be useful. Four forex, Daily, weekly time frame reversal trades are huge! We have back tested the indicator and it did show us great trade entries and exit points. For me any good indicator needs to provide reliable forecasts.

But if you have a system with a strict set of rules you follow that more often then not will produce profitable trades, then you are forex the right track! People in nature over think and over complicate things. Trading can be simple but some common sense has to be used. Price action is king which is proven over and over again.

A great development from a great company. Our philosophy is to make things more simple then what they need to be. We hope our indicator will make peoples lives easier when searching for reversal trades. I am a new trader and at times one is so confused with rsi maby stratrgies out there.

I have however enjoyed reading this strategy you have posted here. Am going to change my settings rsi see if I understan it. Regards Shads shadtrans gmail. Hello there, Ineresting article! But I still find the strategy somewhat complicated. Well, why count till to 50 bars and what is the logic behind this? Then, why not 20, 15, 30 or so…? Did you bactest it or trade it live? Please let me know. This line will always stay on your chart 50 candles back so there is not a tedious process of counting candles all the time.

To answer your question about why we chose 50, the last 50 candles are still meaningful on your strategies on any time frame. THANK YOU VERY MUCH FOR TAKING THE TIME TO EXPLAIN. I AM STILL WAITING FOR THIS INDICATOR YOU PROMISED.

Forex RSI Trading Strategy