EURUSD 19 AUGUST 2020 RSI to ID accumulation in uptrend.
RSI has recently become part of my style. I spent over a year learning how to identify the actions of smart money using volume. Understanding where something is and why its doing what its doing does not require RSI or any other indicator other than volume. I highly recommend that if this is a profession you truly want to pursue, you must spend some time understand volume. Volume is what moves price. With volume, you can very precisely see wether or not buying or selling is active or not. This is arguably the most important thing to understand in the markets and about 99% of people don't, including "experts"... and its actually not that hard.
Imagine volume as energy.
Energy can be stored (accumulated) and/or released (distributed).
If you haven't familiarised yourself with Richard Wyckoff's accumulation and distribution schematics please DDgo them (or google). If you follow me and look and my analysis (thank you very much by the way!) you are probably already familiar with the way I explain things and how I swear by VSA/Wyckoff.
RSI settings are slightly adjusted to increase sensitivity. I find these setting very reliable for signalling particularly on the 15 minute and in Forex (still working out some settings with digital).
I highlighted the areas of accumulation/re-accumulation. What is critical to understand is that we are only using the 1 hour to judge the condition of the trend (bearish or bullish) and not for entry. The 5 and 15 are used for entry because the smaller time frames convey greater detail. Within those two times frames you can begin more of a range analysis versus a trend analysis (will build on that concept in another chart).
Once RSI is below the median line (50 level or a MA) in a positively identified up trend, you can start looking for phase "A" ( selling climax, preliminary support, automatic rally and secondary test). once these are identified the trading range has been established and you can begin looking for phases "C" and "D" for a possible no supply entry after a spring ( or on the spring if you are really good with your risk management).
Again, use RSI for your trend analysis to identify these critical pullback areas and never chase.
Imagine volume as energy.
Energy can be stored (accumulated) and/or released (distributed).
If you haven't familiarised yourself with Richard Wyckoff's accumulation and distribution schematics please DDgo them (or google). If you follow me and look and my analysis (thank you very much by the way!) you are probably already familiar with the way I explain things and how I swear by VSA/Wyckoff.
RSI settings are slightly adjusted to increase sensitivity. I find these setting very reliable for signalling particularly on the 15 minute and in Forex (still working out some settings with digital).
I highlighted the areas of accumulation/re-accumulation. What is critical to understand is that we are only using the 1 hour to judge the condition of the trend (bearish or bullish) and not for entry. The 5 and 15 are used for entry because the smaller time frames convey greater detail. Within those two times frames you can begin more of a range analysis versus a trend analysis (will build on that concept in another chart).
Once RSI is below the median line (50 level or a MA) in a positively identified up trend, you can start looking for phase "A" ( selling climax, preliminary support, automatic rally and secondary test). once these are identified the trading range has been established and you can begin looking for phases "C" and "D" for a possible no supply entry after a spring ( or on the spring if you are really good with your risk management).
Again, use RSI for your trend analysis to identify these critical pullback areas and never chase.