No. of Recommendations: 6
Said asked:
So the real question is what technical analysis indicators are useful, since RSI seems to be useless for this application, what are better ones?A simple search in google came up with these articles on the subject:
investopedia.com - What are best indicators identify overbought and oversold stockstradingtrainer.com - Whats the best overboughtoversold indicatortradermake.money - Overbought and oversold indicatorsmetastock.com: MetaStock | Technical Analysis from A to ZIt is all about the parameters used. If you are aiming for short-term movements, which you should be in a bearish environment, then you have to employ parameters that identify fast moves. During a bullish environment you do the exact opposite - you use parameters that rarely produce a signal. Intermediate finds values between these two.
You'll note that RSI is mentioned. With the right parameters I suppose it would work, but it has to be short-term, not measured in weeks or months.
RSI and stochastics are available on most charting applications, and the default setting is 14 periods, which can be days, weeks, or months.At seven periods measured in days it may work. I've not tried it, at least not in the last twenty years or so. I did all my original TA work in the 90s.
