The RSI Trade

I took the first one.
Kareem

Short and trailing. Looking good so far.

I am out with 20, the second trend line held..for now.

The second line is about to break, but too late for an entry now. Long weekend ahead.

Trend line broke and now the price is re-testing the line. Short still looks good here, but I am still flat.

Murray Math (MM) lines and Bolinger Bands on RSI!
See chart...
Attached MM indicator.... Play with colours and you can use light colours...

This is either crazy or very clever.... . What kind of settings do you use as RSI ? A 14 RSI with 70/80 and 20 / 30 levels, and how do you incorporate the Boll. Bands ?

What does that give you that placing directly on the price chart does not ? I find the idea ( see lizpet`s posts ) to work directly with S/R levels on the RSI very good, but until now the basic success IMHO still comes from seeing divergences and early breakouts before price does.
But who knows ? Can you give some examples applying this, showing the advantage ?

Thank you and happy trading to all...;-)

Interesting Sreeprakash. I will add to my charts and watch. Thanks for sharing.
Kareem

Thank you marple and kareem...

There is a small correction in the chart I posted above. The values shown on MM lines was incorrect, I need to change the timeframe back and forth to get correct values on lines.. its not needed for everytime, but sometimes just changing timeframe gives correct values... The top value is 6067... price dropped from there and went down to 5866, but I closed on 6000, only near 50 pips profit... then I bought on 5982 and given back the pips (lossed)...

marple, RSI is default settings... RSI 21 I am now using...
The 70-50-30 value is mainly I am using, I added 80-20 for visual purpose...

To get bolinger on RSI, just drag bolinger from Indicators section to RSI, then in the Parameters box, just select "Previous Indicators Data"... Dont know about Bolinger on price, but I am seeing Bolinger on RSI is somewhat promising...

I have attached a new chart with new MM lines, and see where RSI touched on Bolinger...

The thing is, I am fascinated to RSI trading... So I am experimenting with new things on it... But we have many false trades that we need to take care...

Currently I am using trendlines, MM lines, volume indicator with RSI...

2 days ago I seen a deltastock chart.. in that they have 2 RSI... 14 period RSI and 28 period RSI on same box.... I tried it but price action not matching with this setup...

The MM lines is somewhat accurate with pivot levels...
So my setup is, find the divergence/breakout on RSI, enter near to pivot levels and use small stop loss... find target using 4 hour timeframes... enter using small timeframes...

All the best...

Hi Sreeprakash.
It's good to see you going through all the possibilities surrounding the rsi and its uses. I feel that the bolly band thing is risky though. Look at this chart for the same time as yours.
The touch of the bands that you used for your short was taken when the rsi is still over 70. It can easily stay up there for ages. Had you waited for the line break after the retest of the 70 line in the purple box with arrow it would have given you a safer entry.
The second t/line break is clear whereas the bolly bands are still squeezing.
Also noteable are the sma(red dotted) bounces in the 2nd and 3rd purple boxes.

Hi Andy, thanks for taking time to analyze my setup.

The trade was this;
Entry 6058, SL 6075, TP manually on 6002...

http://www.forexfactory.com/showpost...&postcount=726


+Why I did taken this trade because, I used divergence, not breakout..

Divergence + RSI 70 area + Murray Math (MM) line was near on 6070 area.. so placed SL above that value... so if this setup work, I get some pips and if not work, I will loss small pips... Bolinger only used for visual purpose.. I relied on RSI and MM line...

The MM lines got some problem, but in the rightside of the chart it showed correct value...

Thanks again for your analysis and we need more thoughts from folks like you....

The attached is new setup based on 4 hour chart...
Entry 5884, sl 5860, tp 5982... (the trendline, the sign).. probably..

And the MM line comes on 5869 saying Ultimate Support on 15 minute chart..

PS: As I said in one of my previous post, the breakout not working for me actually.. So I am using divergence on smaller timeframes, but this may come as breakout in larger timeframes..

GBPUSD, price made another low at 5855. Weekly pivot is around 5859.. I have updated the stop loss of the above trade to 5845 and still running...

See chart, RSI touch bolinger middle line and reversed.. hopefully it will touch trendline again and go up... If not, my loss will be 40 pips... lets see...

Before sometime, it went up to 5911 but I did not closed or updated stop loss... as a result, now running in loss...

Hi Sreeprakash.
I have a few points to make/analyze and please don't be offended if they sound harsh, I do not mean to be rude. I have to point out a few things and hope you take them as they are intended with goodwill. I am sure if I went back and read some of my early posts they would reflect yours and that is why I will make these comments. I am finally starting to make some good money at this and if I can shave some time off your learning process then it will make me content.
I do not know where you are with your money management and if you are live or demo but you seem to be asking yourself and others the right questions to learn all the quicker.
Look at the h4 chart here. I do not see a long trade yet. We are in a massive downtrend and you are trying to pick the bottom. From an M5 chart it might be possible.
That said do not move your stop. If your stop should have been at the weekly pivot then you should position size accordingly and use a wider stop from the outset.
The rsi is at 30 and may stay there while price continues down.
If you were good pips up against the trend they should be in your account now. Don't be greedy. I took 85 yesterday on the second trendline breaks on my earlier chart to you because I knew if that 6000 level broke it would move big. IF I went against the trend like this it would be for a max of 20.

Once somebody told me if I used the word HOPE in a sentence while referring to a trade then I should close it. It could take 5 tries to reverse the down trend at the weekly pivot. Just wait for it to fail with an order below the previous low.
The rsi is camped out in the lower 30/50 channel at the moment and below the massive rsi trendline.
We havent't got confirmed divergence yet either.
Keep your chart as clear as you can. You may find mm lines helpful but they will be gone in 2 weeks and replaced with something else.
Look at the chart I have posted. From a 4hour perspective you should only go long when the 9ema(green) is pointing upwards and broken the 34 (red).
I have only thrown the purple s/r lines quickly onto the chart but these are the only lines you need.
I do not want you to lose money and want your stop loss to hold, but if you were determined to trade long and you put so much faith in the weekly pivot holding then you should go long at the pivot.
Also don't forget how manipulated the market could be this week with holidays so anything that works now may not in the future.
Most of this consisted of statements but any questions, please ask.
Andy

Thanks Andy...
Bro, please keep in mind that if you or anyone say opposite view/suggestions to my view/analysis, thats not offending or outrating me... Actually you are helping me to correct my view and analysis... and helping other people also...

I do not think I am the smart or right, market is always....
Yesterday I got profit and loss...
One experienced trader given signal gbpusd sell and I longed it.. He got 136 pips profit and I got lost earlier profit...

Yes you are right about picking top and bottom.. actually i picked top yesterday and got some success.. now tried to pick bottom and maybe it will hit sl....

Bro, I will never get angry or disappoint if you guys tried to correct me and give more insights... I am not that type of guy...lol.. I value all of your opinions...

Sometime before, I got lost some good amount on forex... after that I am trying to study the market and doing trades with micro account..

Thanks again Andy...

Edit: SL hit on previous trade.. The max I am willing to lose in any trade is 40-50 pips only.. Previous experiences told me that wasting more pips is not good... Earlier I trade for 100-150-175 pips stop losses...

Bought again on 5841, running good now... moved sl to entry... possible target 5881... Price reversed on RSI trendline...

TP hit for 40 pips..
Little relief, earlier loss covered...
Attached image, RSI going to touch bolinger middle line... may cross or reverse...

gbpusd sold...
Entry 5896, sl 6020, possible target 5856..

Edit: seems going good..
Entry criteria, see pic..
MM line 1/8 1.5900
Intersection of two trendlines just above...
RSI showing reverse sign, but bolinger widen...

Well done very nice trades today... keep them coming.

Thanks you bro,
For sometime not seeing your analysis and things..
Please keep updating with charts and insights...

Great discussions and charts. I have not posted any trades because I have really seen any good ones. It does feel as volume is low and traders are waiting until next week. There was one nice short (the first line), but I missed it.