A. If the rsi-run from lower to higher extreme or that from higher to lower extreme is stepped and not straight, it has been a rally and not a sell-off or buy-in.
B. If the rsi-run from lower to higher extreme or that from higher to lower is NOT stepped but straight, it has been a sell-off or buy-in and NOT a rally (unless it is coming out of a ranging/consolidation period, in which case it can be a rally)
square-off and take reverse positon
at the first lower high (in case of long unwinding)
at the first higher low (in case of short covering)
But in case A
do this after the divergence between rsi and priceline
and in case B
divergence is not likely to happen, so no need to wait for it.
Pl note: 1) Play with strict stoploss. You can always retake position.
2) When the market or stock is ranging/consolidating, you can square-off even before lower high or higher low, at the time of rsi touching extreme.
3) Only those graphs should be used which give high resolution tickers. The above mentioned observations have been derived using Google Finance charts. 1month chart with 30 min ticker and 3-6 month chart using 1 day ticker. I have seen that many other chart sources use much biger ticker and hence low sentivity.
2 comments:
Jagmohan Sir,again a nice post to the followup,thx.
Sir, can u put some more light on William%R signals.
When to buy & when to sell with Rsi & william%R along with charts example.
In your prior post I reda over it but without harts its very hard to understand how to take position.
Thx alot for all your help.
Shan Sir can u post a chart of Bank Nf from July 23 to 20aug along with Rsi & William%R mentioning entry & exit point over it.
I am little bit confused in it.
Thx
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