The application of RSI index in the technical analysis of gold trading includes the judgment principles of crossover, numerical value, form and deviation, and the general contents are as follows :(1) overbought and oversold value RSI=50 is the demarcation point between strong market and weak market.
Usually set RSI>80 as overbought area, the probability of falling back is large;
RSI<20 is oversold area, the exchange rate rebound probability is larger.
RSI index below 20= current situation is overselling ¡ú buy signal RSI index above 80= current situation is overbuying ¡ú sell signal RSI index below 20 means that the market is in an overselling state and the market is prone to rebound, which is a buy signal.
An RSI reading above 80 means the market is overbought and prone to falling, a sell signal.
In normal conditions, a downward RSI turn is a sell signal and an upward RSI turn is a buy signal.
But the application of time from the overall situation of the judgment.
RSI attack wave is acute Angle, not obtuse Angle, real trend, high reference value.
(3) The M-shaped trend deviating from RSI is a common peak pattern in overbought areas;
The W – shaped trend is a common bottom pattern in oversold areas.
At this point, the RSI trend and the price trend are often seen to diverge.
Therefore, divergence can also be judged as a buy or sell signal.
(4) Support line ¡¤ Pressure line RSI moves upward from bottom to top, and one trough is higher than the other to form an upward support line;
The RSI moves from top to bottom, with each wave top lower than the other to form a descending pressure line.
A break below the support line is a sell signal, while a rise above the pressure line is a buy signal.
(5) Dividing line RSI above the 50 dividing line is a buy signal, below the 50 dividing line is a sell signal.
(6) The N value of cross N day parameter RSI is usually taken from 5 to 14 days.
The larger the value of N, the stronger the sense of trend, but there is a tendency of reaction lag, which is called the slow speed line;
The smaller the value of N is, the more sensitive it is to changes, but it is easy to produce a sense of drift, which is called fast line.
Therefore, the slow line and the fast line can be compared and observed. If the two lines go up together, it means that the rising trend is strong.
If the two lines go down together, the decline is stronger;
If the fast line interspersed with the slow line is a buy signal;
If the fast line interspersed with slow line for the sell signal.
(7) Passivation Due to the design of RSI, in extreme rising or falling market, RSI continues to maintain this state after entering the overbought or oversold area, resulting in passivation problem.
Especially in the continuous rise or fall in the unilateral trend, easy to buy and sell “too hasty” regret.
The solution to this problem, only in terms of the RSI index itself, is to adjust the overbought or oversold zone definition index, such as above 90, below 10;
The other is to increase N.
In the technical analysis of foreign exchange gold trading, RSI indicators often need to be mixed with other technical indicators to achieve the best effect, such as MACD, Brin line, moving average, etc.
