RSI Indicator Chart Setups & Trend-Lines
Traders can draw trendlines on the RSI in the same way as you as a stock indices trader can draw trendlines on the price charts. RSI trend lines are drawn the same way trend lines are drawn on the chart; by joining consecutive highs of the RSI indicator or consecutive lows on the RSI Indicator.
RSI Trend-Lines and Trend-lines on Stock Indices Charts
RSI Setups in Indices Trading
RSI Chart patterns like head and shoulders stock patterns or triangle stock trading chart patterns that aren't evident on the price chart are often formed on this RSI indicator.
RSI indicator also often forms patterns like a head and shoulders or triangles chart patterns that may or might not be visible on the price chart. As shown on the chart below the Reverse Head & Shoulders reversal setup formation is clearly illustrated on this indices trading RSI indicator.
Index Chart Setups on RSI Technical Chart Indicator
Support and Resistance Zones using RSI Indicator
Sometimes chart levels of support & resistance levels are demonstrated better on the RSI indicator than on the price chart.
In an upward stock market trend the support zones should not be broken at any one time, if they are broken then stock price will also break the support zones & the upward trend is going to reverse.
In a downward trend the resistance areas should not be broken, if they are broken then stock price will also break the resistance areas, and the downward trend is going to reverse.
Support & Resistance Levels on RSI Indicator
In the trading example revealed above when the third resistance level was broken the downwards trend reversed to an upwards trend & when the sixth support was broken the upward stock market trend reversed and broke the upwards trend line.
Learn More Lessons and Tutorials and Courses:
- US 30 Index Market Hours
- Index Trade IBEX in FX
- How to Trade SMI in MetaTrader 4 Platform
- How Can I Analyze MT4 Downwards Indices Trend-line in MetaTrader 4 Platform?
- How Can I Find SPAIN35 on MT4 iPad Trade App?
- What's SPAIN35 Index Trade Chart?
