Wednesday, May 14, 2014

RSI Trend Line Charts

 RSI indicator to use it as an indicator to help identify whether trend would continue or if the supply and demand zones were strong enough to hold. While discussing the indicator in detail most traders decided to apply it to the broad markets to see if it had any use as a market trend predictor. This is the modified indicator did prove its worth. As with any technical indicator, the RSI should be used as a confirming indicator, not a decision making tool.  Price and supply and demand should be the only thing you use for your decisions to enter or exit the markets. The RSI offered both positive and negative divergence signals to warn of trend changes before the 2008 credit bubble burst and the 2009 bottom.  The trend changes were confirmed with the RSI moving below 40 bearish  or above 60 bullish .
RSI Trend