Monday, September 16, 2013

RSI TECHNICAL INDICATOR


Relative Strength Index     
The Relative Strength Index (RSI) is an extremely useful  momentum, oscillating and leading indicator and indicates overbought (price is too high) and oversold (price is too low) conditions. that was developed by j.welles wilder and is one of the most widely used indicators in technical analysis that measures current price strength in relation to previous prices.
 This is a leading indicator of a trend change. The results are used to deliver messages about the strength of the market. It is used to indicate when a stock comes off its overbought or oversold conditions. The main purpose of the study is to measure the market's strength and weakness.

The RSI is a versatile tool, it can be used to
  • Generate buy and sell signals
  • Show overbought and oversold conditions
  • Confirm price movement
  • Warn of potential price reversals through divergences
The RSI is an oscillating indicator, fluctuating between 0 and 100. 50 is the centerline. Anything above 70 is considered overbought, and anything below 30 is considered oversold. While this 70/30 levels are more common.

The RSI is calculated by monitoring changes in the closing prices of the stock. The number of higher closes is compared to the number of lower closes for the selected period. The RSI compares the internal strength of a stock by looking at the average of the upwards price changes and comparing it with the average of the downward price changes. The results are expressed as a percentage, providing the upper and lower boundaries

When the RSI above 70  or below 30 does not indicate  a Top or Bottom. A failure swing or divergence accompanies your best trading signals. 

Another use of the RSI is divergence. Market prices continue to move higher/lower while the RSI fails to move higher/lower during the same time period. Divergence may occur in a few trading intervals, but true divergence usually requires a lengthy time frame, perhaps as much as 20 to 60 trading intervals. 

The RSI exhibits chart formations as well. Common bar chart formations readily appear on the RSI study. They are trendlines, pennants, flags, head and shoulders, double tops and bottoms, and triangles. In addition, the study can highlight support and resistance zones.


 

How is it calculated ?

RSI is calculated, using the formula
RSI = 100-100( 1-RS)
Where RS is ( Average Gain) / (Average Loss) for the specified period. However Average Gain and Average Loss are not true averages as they are always divided by the period of the RSI, which wilder suggests should be 14, though some traders prefer using 28 period RSI

Relative Strength & Divergences





A powerful method for using the Relative Strength Index is to confirm price moves and forewarn of potential price reversals through RSI Divergences.
The divergence between RSI Indicator and underlying stock price is the most important signal provided by RSI, and it can be an indication of an impending reversal. Using the RSI divergence (bullish and bearish), chart patterns, trendlines, support, and resistance lines along with the RSI Indicator chart can be very useful.


 Divergence signals give the trader an advantage by confirming an entry into a downtrend as it weakens and just before it turns into an up trend. It is also used to get out of an up trend as it weakens, and before it collapses into a downtrend. The divergence signal does not occur every time a trend changes, but when it does, it delivers a strong confirmation signal that a trend break is likely. Traders use the RSI divergence as an early warning signal to enable them to prepare for a trend change.

When the RSI and price chart lines move in the same way we get a confirming signal that the existing price trend is unlikely to change.


Sunday, August 11, 2013

NIFTY FUTURE TRADING STRATEGY FOR 12/08/13





LAST CLOSE @ 5590


TODAY SUSTAINING ABOVE 5605...........DONT SHORT............BULLS WILL FIREEE

ULTIMATE TARGET 5674------- 5681---------5688

MINOR RESISTANCE LEVEL @ 5655

IF BREAKS AND TRADE ABOVE 5688

NEXT TARGETS MAY BE 5708--------5733

SUPPOSE  TRADING BELOW 5605........BEARS WILL RETEST

5641--------5615-------5480-------5463 NOT RULED OUT !!!

Subject To Disclaimer





Wednesday, August 7, 2013

NIFTY FUTURE TRADING STRATEGY FOR 08/08/13





LAST CLOSE @ 5554


BULLS HOPE ONLY ABOVE 5605-10............SEEMS NOT EASY TO BREAK THIS LEVEL !!

TODAY TRADING BELOW 5546

BEARS WILL RULE..........WILL SLIDE TO

5503---------5495-------5480

ONCE BREAK AND TRADE BELOW 5480 WITH VOLUMES

THEN TARGET 5463

INTRADAY RESISTANCE @ 5578 AND 5605

SUSTAINING ABOVE 5605...........WATCH ONLY NON STOP RALLY TILL

5630--------5660 

Subject To Disclaimer


Tuesday, August 6, 2013

NIFTY FUTURE TRADING STRATEGY FOR 07/08/13



LAST CLOSE @ 5573

TODAY MAIN RESISTANCE @ 5583 AND  5608

SUSTAINING BELOW 5573........NO HOPE FOR BULLS

WILL SLIDE TO 5538---------5503--------5480 

MINOR SUPPORTS @ 5515 AND 5495

FOR NEXT UPMOVE......BULLS NEED TO TRADE AND CLOSE ABOVE 5610....ELSE EVEN 5480 - 50  NOT RULED IN INTRA OR IN COMING DAYS !!!

FROM 6050..... ALERTED ALL READERS .....ONE OF THE MOST  POWERFUL BEARISH PATTERN RISING WEDGE  FORMED IN DAILY CHART......CAN EXPECT MAJOR FALL IN COMING DAYS ......BEARS WILL  RETEST ATLEAST 5500----5480 LEVELS  !!!!

ITS ONLY POWER OF CHART......BELIEVE IN CHARTS...... NOTHING ELSE !!!!

Subject To Disclaimer



Monday, August 5, 2013

NIFTY FUTURE TRADING STRATEGY FOR 06/08/13


Animated wallpaper, screensaver 240x320 for cellphone

LAST CLOSE @ 5723.6

TODAY MAIN SUPPORTS @ 5702--------5695

TRADING AND SUSTAINING ABOVE 5708...........HOPE BULLS WILL RULE

WILL TAKE TO 5763---------5773 NOT RULED OUT IN INTRA !!!

IF BREAKS AND TRADE ABOVE 5773..........WILL BLAST TO

5787-97 LEVELS

BUT STAYING  BELOW 5695..........WILL SLIDE TO

5681--------5658-------5630

Subject To Disclaimer

Sunday, August 4, 2013

NIFTY FUTURE TRADING STRATEGY FOR 05/08/13


Animated wallpaper, screensaver 240x320 for cellphone

LAST CLOSE @ 5705

INTRADAY MAIN RESISTANCE AREAS ARE
5718-------5730--------5737

ABOVE 5737 NEXT DISTRIBUTION LEVELS @  5750-60

KEEP AN EYE AROUND 5730---5737 LEVELS.............SEEMS ROCK RESISTANCE AREAS !!!!

ANY WAY TRADING BELOW 5737............NO HOPE FOR BULLS

POSSIBLE TARGET 


BELOW 5622.......NEXT TARGET ????

WILL UPDATE DURING TRADING HOURS

Subject To Disclaimer




Wednesday, July 31, 2013

NIFTY FUTURE TRADING STRATEGY FOR 01/08/13




LAST CLOSE @ 5781

INTRADAY MAIN SUPPORTS @ 5773-------------5750

ABOVE 5750...........EXPECT (100-125) POINTS RELIEF RALLY ON CARD  !!!!

MINIMUM TARGET MAY BE 5845--------5869

SUPPOSE BULLS FAIL MANAGE TO HOLD 5750..............THEN NEXT DOWNSIDE VISIBLE TARGET

5730----------5708-------5692 LEVELS

Subject To Disclaimer




Tuesday, July 30, 2013

NIFTY FUTURE TRADING STRATEGY FOR 31/07/13


LAST CLOSE @ 5797

INTRADAY RESISTANCE LEVELS @ 5808----------5816-------5825

IF BREAKS AND TRADE ABOVE 5825........THEN NEXT VISIBLE TARGET 5854

STAYING BELOW 5808.............INDICATING BEARS HAVE UPPERHAND


BIG FALLLL ON CARD....FAST & FURIOUS.........TARGET




THEREAFTER AROUND 5730 WILL ACT AS SUPPORT

BELOW 5730............WILL FALL TILL

5717-------------5703 NOT RULED OUT IN INTRA !!!!

Subject To Disclaimer


Monday, July 29, 2013

NIFTY FUTURE TRADING STRATEGY FOR 30/07/13



LAST CLOSE @ 5877

TODAY'S ROCK RESISTANCE AREAS @ 5899-----5907------5916

SUSTAINING  AND TRADING BELOW 5870.......RESERVED FOR BEARS ONLY

TARGET 5842-38 LEVELS

LAST HOPE FOR BULLS AROUND  5838-48 LEVELS

SUPPOSE BREAKS AND TRADE BELOW 5838.......THEN WILL FALL TO 5816 AND 5808

Subject To Disclaimer





Sunday, July 28, 2013

NIFTY FUTURE TRADING STRATEGY FOR 29/07/13


Animated wallpaper, screensaver 240x320 for cellphone

LAST CLOSE @ 5925

SEEMS INTRDAY STIFF RESISTANCE @ 5930---------5938---------5953

BELOW 5938.............NO HOPE FOR BULLS.......WILL SLIDE TO

5897---------5870---------5864--------5837

BULLS NEED TO CLOSE ATLEAST ABOVE 5970  

ELSE BEARS WILL  RETEST MINIMUM  5830-35 IN COMING DAYS



ALL LONGS SHOULD BE CAREFUL.............BIG FALL ON CARD IN COMING DAYS.............OUR MANTRA IS ANY RISE SELL......SELL.....SELL.......BULLS REAL STRENGTH ONLY ABOVE 6060

Subject To Disclaimer







Sunday, July 21, 2013

NIFTY FUTURE TRADING STRATEGY FOR 22/07/13


Animated wallpaper, screensaver 240x320 for cellphone

LAST CLOSE @ 6043

INTRADAY MAIN SUPPORTS @ 6032 AND 6021

MAIN RESISTANCE @ 6052---------6066

FOR NEXT RALLY ........BULLS NEED TO BREAK AND TRADE ABOVE 

6077--------6080 LEVELS............SEEMS STIFF RESISTANCE HERE !!!

CAN BULLS BREAK 6080 ????? IF YES........NEXT INTRADAY TARGET WILL BE

6100----------6120---------6127

SUPPOSE BULLS FAILS TO HOLD 6032............ INDICATING LOSING ITS CONTROL

MAY SLIDE TILL 6024---------6021 LEVELS

AFTRE THAT .............6002 AND 5990 NOT RULED IN INTRA

Subject To Disclaimer



Thursday, July 18, 2013

NIFTY FUTURE TRADING STRATEGY FOR 19/07/13


Animated wallpaper, screensaver 240x320 for cellphone


LAST CLOSE @ 6052

INTRADAY SUPPORTS @ 6039-------6032

SEEMS STRONG SUPPORT @ 6032

TRADING BELOW 6032 WITH VOLUME FOR 10-15 MINUTES  ......WILL SLIDE TO 6024 AND 6006 

ALERT : ABOVE 6032.........BULLS WILL  RULE........SO DON 'T SHORT

STAYING ABOVE 6052...........BULLS WILL  FIREEE TILL

6080 NOT RULED OUT IN INTRA.......ON  THE WAY KEEP AN EYE @ 6067

AROUND 6077 - 80 WILL ACT AS STRONG RESISTANCE FOR BULLS 

 BREAK AND TRADE ABOVE 6080......WATCH ONLY NON STOP RALLY 

NEXT TARGET 6100--------6113----------6120

Subject To Disclaimer

Tuesday, July 16, 2013

NIFTY FUTURE TRADING STRATEGY FOR 17/07/13




LAST CLOSE @ 5970



BULLS HOPE ONLY ABOVE 5985.......FOR FURTHER RALLY BULLS NEED TO BREAK AND SUSTAIN.......ELSE BEAR WILL ATTACK TILL 5890-----5850 IN COMING DAYS ????


AVOID SHORTS ABOVE 5980-85

SUPPOSE BREAK AND SUSTAIN ABOVE 5985........BULLS WILL FIREEE TILL



6006---------6026-----------6035 ?????

TRADING BELOW 5970...........WILL FALL TO 5939---------5926-----------5916

BREAK AND STAYING BELOW 5916

BEARS TARGET 5890---------5850 LEVELS NOT RULED IN INTRA !!!

Subject To Disclaimer



NIFTY FUTURE TRADING STRATEGY FOR 16/07/13




LAST CLOSE @ 6033

NOW SGX TRADING @ 5930 ( 101 POINTS DOWN)

INTRADAY SUPPORTS @ 5926---------5916

BELOW 5916...........MARKET MAY SLIDE DOWN TO 5890-----------5850 LEVELS IN INTRA NOT RULED OUT

Subject To Disclaimer



Monday, July 15, 2013

NIFTY FUTURE TRADING STRATEGY FOR 16\07\13




LAST CLOSE @ 6007

6026 WILL ACT AS RESISTANCE FOR BULLS IN INTRA

AVOID SHORTS ABOVE 6006

IF ONCE BREAK AND HOLDS ABOVE 6026............BULLS WILL TRY TO HIT

6048-52 LEVELS..............THEREAFTER 6077 TARGET FOR BULLS
SEEMS MINOR RESISTANCE @ 6038

SUPPORTS @ 5990--------5977----------5960

Subject To Disclaimer


Thursday, July 11, 2013

NIFTY FUTURE TRADING STRATEGY FOR 12/07/13




LAST CLOSE @ 5941

TRADING ABOVE 5939.........DONT SHORT........BULLS TARGET

5970----------5985--------5990 LEVELS

5985-90 WILL ACT AS ROCK RESISTANCE FOR BULLS

ABOVE 5990............NEXT  POSSIBLE TARGET

6005----------6025

SUPPORTS @ 5926--------5916--------5903

Subject To Disclaimer

NIFTY FUTURE TRADING STRATEGY FOR 11/07/13


LAST CLOSE @ 5822

NOW SGX NIFTY TRADING @ 5900 ( 98 POINTS UP )

SEEMS STIFF RESISTANCE AROUND @ 5897--------5905 LEVELS

SHORT AROUND THESE LEVELS WITH 10-15 POINTS STOP LOSS

FOR TARGET 5870-------5855--------5838--------5818 FOR INTRADAY ONLY

SUPPOSE SUSTAINING ABOVE 5905 FOR 10- 15 MINUTES OR MORE.........SHOULD EXIT YOUR SHORTS.........BULLS WILL TAKE TO

5925-------5935 POSSIBLE

Subject To Disclaimer



Monday, July 8, 2013

NIFTY FUTURE TRADING STRATEGY FOR 09/07/13




LAST CLOSE @ 5829

INTRADAY SUPPORT @ 5816 AND 5808

SUSTAINING ABOVE 5816.............WILL TRY TO HIT 5847 AND 5855 

SEEMS STIFF RESISTANCE AREAS @

Blinking Text

ONCE BREAK AND SUSTAIN ABOVE 5855...........BULLS WILL RULE

TARGET MAY BE 5870----------5883 NOT RULED OUT IN INTRA

BELOW 5816.............BULLS LOSING ITS GRIP...........WILL FALL TO

5796------5781------5772

Subject To Disclaimer





Sunday, July 7, 2013

NIFTY FUTURE TRADING STRATEGY FOR 08/08/13




LAST CLOSE @ 5875




AND 


MAIN RESISTANCE @ 5897 AND 5905

SUSTAINING BELOW 5869........BULLS LOSING ITS CONTROL......CAN EXPECT ATTACK FROM BEARS .....WILL TRY  DRAG DOWN TO 5852----------5837---------5830 LEVELS

THEREAFTER 5818 WILL ACT AS ROCK SUPPORT FOR BULLS

BELOW 5818...........NEXT BEARS TARGET 5808----------5796

INTRADAY RESISTANCE @ 5897 AND 5905

ABOVE 5905............BULLS WILL FIREEEE .........TARGET 5927 AND 5931

Subject To Disclaimer