Simple Technical Analysis

what's missing?

Volume.

Fib

The higher RSI swing can bring an immediate reversal in context of a downtrend. Even if it were to travel sideways out of the channel it would drop back to test the top of the channel again, sometime. But I think it will test the channel centerline first and then a chance to move out of the channel. Bullish div in macd has not been reliable and is just as often producing an overbought condition.

Edited by AChartist, 29 October 2008 - 02:11 PM.

I agree the MACD has its limitations, but I've found that its best to trade (short term) with the trend of the MACD. Once the daily MACD starts moving up and especially if it crosses zero to the positive, then the short term signals (i prefer the 15 min) are used to target entries. Hence yesterday at 860. Daily moved up and the 15 moved into buy territory. The daily is still up but as I posted earlier the short term intraday timeframes are getting mighty stretched. The key to yesterday of course was the divergence in the RSI. A great indicator. mm

My special RSI indicator and several versions of it looked similar to basic RSI. They had bullish div and that worked yesterday. These variants include macd, ema, MFI, ATR terms, all the indicator variations produce about the same output, telling me that RSI is the one driving the whole boat. Since all my variations correlated closest with straight RSI. It may be the only indicator we need. And for MACD, a long signal requires a rising signal line. This time, signal was still flat and didnt hold. So I use macd too with RSI, requiring a rising daily signal line. That higher RSI swing is death but it usually forecasts the final low, this next one may be it.

Edited by AChartist, 29 October 2008 - 03:32 PM.