FREE FOREX STRATEGIES
Forex brokers comparison

Forex trading strategy #4 (RSI High-Low)

Although no trading system can solely rely on RSI indicator, using it in combination with other tools and proper technical analysis can bring a new edge to your Forex trading.

Setup:
Currency pair: Any.
Time frame: Any.
Indicator: RSI (14) with levels at 70 and 30.


Read entire post >>>


 


No moving averages are applied to RSI in this Forex strategy.

Regards,
Edward

Hi Edward

I would want to know the best trading strategy somebody can apply when the market is ranging i.e when the market is moving sideways

thanks

Victor

Hi Victor,

for ranging markets you may try:
Tunnel method
and also Bollinger bands trading - bollinger bands are very effective in ranging markets, you simply trade every bounce of the bands.

Actually there is one very effective and simple Forex system based on Bollinger bands. It goes as follows:

-------------------------------------------------------

Indicators: Bollinger bands (20, 2) applied to close.

Once ranging market is identified, traders work with candlesticks that touch upper and lower bands of the Bollinger band indicator:

If a red candle touches the upper Bollinger band, go Short with a new candle open.
If a green candle touches the lower Bollinger band, go Long with a new candle open.

If a green candle touches the upper Bollinger band, wait. If next candle closes in red, then go Short with a new candle open.
If a red candle touches the lower Bollinger band, wait. Only if next candle closes in green, go Long with the next new candle open.

Stops are couple of pips away from the last candle to touch BB.
If a signaling candle also touches middle Bollinger band on the close, refrain from entries as a correction has high chances to occur.

-------------------------------------------------------------

Another Strategy - based on MACD consolidation may be of some interest.

Happy trading!
Edward

There are no exit rules posted for the "RSI High-Low" strategy. Has anyone played with different exit rules based on this strategy? Seems like the RSI is able to indicate entry points well, but I'm struggling with when to exit.

Thank you all,

William Hanson

To me, RSI can't suggest exits well.
Among simple solutions there is Parabolic Sar indicator. Exit when it changes dot color.
Another way known to me is Heikin Ashi candlesticks.
Exit when Heikin Ashi candles change color. Also you may use trailing stop = place it above the last Heikin Ashi candle when Short and below when Long.
Cheers,
Sam

ohh i love this site. Thanks Edward!!!

Hi Edward,
It's very informative and interactive page. Very good for newbies.

Cari, MY

Hey Ed
I am relatively new to forex trading about 4 months in and 9% profit to a practice account. Thing is, i have noticed i am OFTEN late to enter or early to exit so i added RSI to my existing strategy of 7,14,21 MVA(simple moving average)and the 12,26,9 MACD

my strategy was to start watching a chart closely when the MVA looked good and to create an order when the macd told me to but by adding the RSI what order should i look @ the indicators by. i know there prob isn't a definite rule to this but in general what order would you look @ the indicators.

after comparing RSI to macd it seems rsi indicates buy before macd does

should i be adding something instead of RSI?