Friday, February 20, 2009 8:25:30 AM
valuemunger... here's a slight variation on the RSI/Simon thing...
i look for the RSI(2) to have come up from below the 10 line and crossing over the RSI(5). BCO didn't really have a buy signal today but AAON did and notice the RSI 2/5 cross (chart below). like Quill, i mainly use the RSI's for directionality and on the intraday charts leave the RSI(5) off and only use the RSI(2). in that application (intraday 15, 5, min.) the RSI(2) crossing the 50 line seems to work better. it works for exit signals as well... when the RSI(2) gets in the 80 - 90 range then i'm on watch for an exit. But i do not base my trades soley on the RSI, it's a combination of things, trend line breaks, volume, price action, candles... etc. Keep playing with it... test, test, test, on paper trades until you find something that works for you.
i look for the RSI(2) to have come up from below the 10 line and crossing over the RSI(5). BCO didn't really have a buy signal today but AAON did and notice the RSI 2/5 cross (chart below). like Quill, i mainly use the RSI's for directionality and on the intraday charts leave the RSI(5) off and only use the RSI(2). in that application (intraday 15, 5, min.) the RSI(2) crossing the 50 line seems to work better. it works for exit signals as well... when the RSI(2) gets in the 80 - 90 range then i'm on watch for an exit. But i do not base my trades soley on the RSI, it's a combination of things, trend line breaks, volume, price action, candles... etc. Keep playing with it... test, test, test, on paper trades until you find something that works for you.
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