RSI Archives • Futures Day Trading Strategies

Posts Tagged Under: RSI

How to Trade With Indicators the Right Way

 

Indicators can be a great addition to your trading methodology. But they can also ruin even the best trading approach if you don’t know how to use and / or combine them with other tools in efficient ways.

In this article, we provide you with a realistic view of trading with indicators, how to choose the right one and which indicator mistakes to avoid.

 

Do you know your edge and trading strategy?

The biggest mistake traders make is that they try to be in the market and find trades all the time. The professionals, on the other hand, know exactly which market circumstances favor their trading approach and then choose their tools accordingly.

If you are a trend-following trader, you should look at momentum indicators and stay away from oscillators. When you are a range trader, on the other hand, momentum indicators won’t improve your trading and you have to pick from oscillators.

Using

Read More


Indicator Trading Vs Price action – Tips to help you make the right decision

 

Indicator Trading Vs Price action

The question regarding whether you should use price action only or rely on indicators when making trading decisions is probably among the most controversially discussed trading topics. At the same time, there are many misconceptions around this topic that keep traders from making the right decisions for their own trading. In this article, we discuss the pros and cons of Indicator Trading vs Price Action trading and we debunk some of the most commonly shared myths.

Are indicators lagging?

The number one argument of price action traders is that indicators are lagging. But why is this not true and what do some traders miss here?

It’s important to understand that indicators and price action is really not different. Indicators take the price action information you see on your charts and then perform calculations based on that information. Thus, the indicator shows you exactly what

Read More


How to detect true breakouts that can lead to great runs

 

The ability of being able to distinguish between breakouts that fail and breakouts that succeed is an important trading skill. Many traders run into problems by making the wrong decision prior to a potential breakout and falsely estimating the likelihood for a successful or failed breakout. In this article, we will share 7 principles of technical analysis that will help you trade breakouts effectively and find breakouts that lead to potentially large trending moves.

Pullback and retest

This is your odds-enhancer when trading breakouts around support and resistance levels. Breakouts rarely lead to runaway trend moves; it is much more common to see a breakout, followed by a pullback and a retest of the initial level.

We understand that FOMO (the fear of missing out) is a common bias and being scared of missing large trends is what makes people enter trades too early. However, waiting for the successful retest of a breakout

Read More


How to improve signal accuracy of Dojis

 

Dojis are among the most popular candlestick patterns; they are easy to spot, happen frequently and visualize an important market structure. A Doji candlestick consists of 2 candle-shadows to both sides and a small body – typically, the body is just a single line when the open and the closing price of the Doji fall at the same level. However, Dojis don’t necessarily have to open and close at the same price. A reasonably small body can also be considered a Doji pattern – it is more about the psychology and the balance between buyers and sellers that are important and not the exact shape.

The screenshots below show 2 classic Doji patterns. To read and interpret Dojis correctly, it is also important to consider the candles before the Doji and the first candle immediately after the Doji. A Doji after a rally and a subsequent bearish candle can foreshadow a

Read More


The difference between Momentum and Volatility, and how to use it in your trading

 

The misunderstandings and misconceptions between volatility and momentum can lead to expensive trading mistakes and can even result in totally flawed chart and market analysis and trading decisions.

Volatility and momentum are two fundamentally different things and we will explore the differences between the two concepts, how to measure volatility and momentum and how to use them for effective trading decisions.

 

What is volatility?

Volatility describes how much price fluctuates around a mean. If you would use a moving average and see price going back and forth around the moving average, markets are in a high volatility environment. Furthermore, if candlesticks have relatively long candle shadows, compared to the candle body, it also signals a volatile market.

Thus, volatility is also often referred to as a risk indicator because high price fluctuations can signal indecision in the markets and the powers between buyers and sellers are constantly shifting.

 

What is momentum?

To a certain degree, momentum

Read More