Price action plus RSI: what's your combination?
RSI adds a momentum and overextension read to pure price action: divergence at levels, overbought fade zones, or the 50-line as a trend filter. The combination is one of the most popular in retail trading.
Describe yours:
- how RSI filters or triggers your price-action setups
- the settings you settled on
- the false signal the combo still produces
The RSI guide covers the indicator's real behaviour.
Background: The RSI indicator explained: overbought, oversold and divergence
The Relative Strength Index measures how strong recent moves have been. How it is calculated, what 70 and 30 really mean and why RSI can stay extreme in a trend.
What does RSI above 70 mean?
That recent gains have been strong compared with recent losses. It is called overbought, but in a strong uptrend the price can keep rising while RSI stays above 70.
What is the best RSI setting?
The standard is 14 periods, as Wilder proposed. Shorter settings react faster with more false signals; longer settings are smoother. There is no single best setting.
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