What is RSI:-
RSI stands for Relative Strength Index, which is a popular technical indicator used in financial markets, particularly in the analysis of stocks, commodities, and other securities. RSI is used by traders and investors to assess the strength and potential direction of price movements in an asset. Here's how RSI works:
Calculation : RSI is calculated using a formula that takes into account the average gain and average loss over a specified period (typically 14 periods). The formula is as follows:
RSI = 100 - (100 / (1 + RS))
- RS ( Relative Strength ) = Average gain over the specified period / Average loss over the specified period
Interpretation :
- RSI values range from 0 to 100.
- An RSI value above 70 is often considered overbought, suggesting that the asset may be due for a price correction or reversal.
- An RSI value below 30 is often considered oversold, suggesting that the asset may be due for a price rebound or reversal.
- Some traders use additional levels, such as 80 and 20, for overbought and oversold conditions, respectively.
Signals :
- When RSI crosses above 70 = SELL
- When RSI crosses below 30 = BUY
- Some traders also look for bullish or bearish divergences between RSI and the price chart as potential reversal signals.
It's important to note that RSI is just one tool among many used in technical analysis, and it should be used in conjunction with other indicators and analysis methods for making informed trading or investment decisions. Additionally, the choice of parameters (e.g., the number of periods) can be adjusted to suit the specific trading style and asset being analyzed.
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- ALL settings that related to GBPUSD pair has been uploaded via screenshots .
Tested On [ GBPUSD ] 1 hour time frame pair only and passed .
- you can use all pairs and all time frames.
- there are many settings that related to Riskmanagment.
Recommendations :-
1- do your backtest before live trade.
2- use demo account for at-least 1 month.
Note :- GBPUSD backtest without stop-lose :)
Best regards
Q8Crackers team
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