Last time we considered the topic about the technical indicator's types combinations to increase your profit. I promised you to show in details some strategy which applies combination of the indicators.
Let's consider the TREND + OSCILLATOR strategy which uses the EMA and RSI indicators.
First of all we should define the direction of a market trend. The price is above 200 EMA means that the market is in global uptrend. So, we are going to search bullish signs for RSI indicator.
Today we are going to use RSI in a non-standard way. We will search the RSI downtrend lines breakouts. You can see such line on the chart. When the RSI breaks through this line during the price is in the uptrend it is a buy signal. It is great to have another one confirmation. Here we can see that the price bounced off the 200 EMA and exactly after that there was a massive growth.
Why does it work? During the uptrend we often have the consolidation or correction phases. If the RSI is in the downtrend it means that the asset's oversold zone is upcoming, but the market is in the uptrend and bulls dominate. Thus, the money reaccumulates here and when the bear's activity become weak the bulls push the price above rapidly.
DISCLAMER: Information is provided only for educational purposes. Do your own study before taking any actions or decisions.
I can share templates and styles with you, just send a personal message :)
michaeldouglas1915
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@SkyrexTrading, I found this great
michaeldouglas1915
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@SkyrexTrading, rsi Trendline seem like a strong signal to trade off. I haven’t heard to much about them while there are so many more complicated trading techniques this seems to work better for me.
Would you share templates and styles with me please?