Forex RSI Strategy Introduction:
RSI çi ye?
RSI li short version of Index Hêz Dengûbasên e. A oscillator pêşveçûnên ku leza û guhertinan ji buhayê bazarê dipîve. The nîşana by hate pêşxistin Welles Wilder. He also developed other famous indicators such as Parabolic SAR, Average Directional Index etc. End of the RSI background story.
Wiha, what’s inside this report?
In this post, you’ll discover the 2 methods for using RSI effectively. This short and to the point blog post will help to understand and learn how to use RSI effectively.
Here is the basic knowledge you can understand with RSI:
You can find the trend by knowing the direction of the RSI line.
Ew middle line on the RSI window is 50
If the RSI line is above 50, then trend is bi jorve.
If the RSI line is below 50, then the trend is jêr.
Lebê, this is not the main method you’re going to discover.
The Forex RSI Strategy Method:
Forex RSI Strategy Method 1: Divergence
RSI also can be used to find divergence signal. Divergence happens when the price of the market is not aligns with the RSI direction.
Bo nimûne, the EUR/USD price is trending up while RSI is trending down, notice the direction of market is not align with trend so this is called divergence. Di vê rewşê de, this is called buy divergence.
Divergence is indeed effective for finding accurate and early reversal signal.
Lower Side of price and RSI
– The buy/positive divergence happens on the lower side of the price and RSI (notice I don’t use lower high or etc because I want to keep it simple to understand for most traders)
RSI divergence in action: Mînak 1
– The sell/negative divergence happens on the upper side of the RSI and the price.
See RSI divergence in action:
Forex RSI Strategy Method 2: RSI Trend lines breakout
We can also use trend lines on the RSI to identify the turning point of the trend.
Buy signal: Enter on the next candle after the break of the trend line on RSI.
Sell signal: Enter on the next candle after the break of the trend line on RSI.
The Forex RSI Strategy Method In A Nutshell:
Wiha, here is a basic outline of what you’ll be doing with these methods:
1. Awa 1: Upper divergence for sell, Lower divergence for buy signal.
2. Awa 2: Use trendline breakout to determine the turning point of the market.
***Bexşîş: Combine the methods with nimûneya qendîlê will significantly boost the confirmation.
Ez hêvî dikim hûn kêfa xwendina vê kurt, simple blog post on an easy way to dominate RSI. I wish you the best success in your trading! Do share this post if you find it useful 🙂
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