RSI Trading Indicator Stock Chart Patterns and Stock Indices Trend Lines
Stock Index traders can plot trend lines on the RSI in the same way as you can plot trend lines on the Stock Indices price charts. RSI trend lines are plotted the same way Stock Index trend lines are plotted on the Stock Indices trading chart; by joining consecutive highs of the RSI Stock Index indicator or consecutive lows on the RSI Indicator.
RSI Trend Lines and Stock Indices Trend lines on Stock Indices Trading Charts
RSI Chart Patterns in Stock Indices Trading
RSI Chart patterns such as head and shoulders chart patterns or triangle chart patterns which are not evident on the Stock Indices price chart are often formed on this RSI Stock Index indicator.
RSI Stock Index indicator also often forms Stock Indices trading chart patterns such as head and shoulders or triangles chart patterns that may or may not be visible on the Stock Indices price chart. As shown on the Stock Indices trading chart below the Reverse Head and Shoulders reversal formation is clearly shown on this Stock Indices RSI indicator.
Stock Chart Patterns on RSI Stock Index Trading Chart Indicator
Support & Resistance Levels Trading using RSI Indicator
Sometimes Stock Indices trading chart levels of support & resistance levels are demonstrated better on the RSI indicator than on the Stock Indices price chart.
In an upward Stock Indices market trend the support levels should not be broken at any one time, if they are broken then price will also break the support levels and the upward Stock Indices trend is going to reverse.
In a downward Stock Indices trend the resistance levels should not be broken, if they are broken then price will also break the resistance levels, & the downward Stock Indices trend is going to reverse.
Support & Resistance Levels on RSI Indicator
In the Stock Indices trading example above when the third resistance level was broken the downward Stock Indices trend reversed to an upward Stock Indices trend and when the sixth support was broken the upward Stock Indices market trend reversed & broke the upward Stock Indices trend line.
