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The RSI TC New or RSI with Trend Catcher is a trend trading algorithm developed on the basis of the functioning of two effective indicators. This algorithm was created for trend trading, that is, any trade using the RSI TC New indicator is opened taking into account the direction of the current market trend. In addition determining the trend and opening trades during this period, the indicator is also suitable for determining the market in overbought or oversold zones. The indicator is displayed in the lower window of the price chart as a solid line, which acquires a certain color during a period of a market trend and moves in a certain direction relative to signal levels, at the intersection of which points of a certain color appear in the indicator window, depending on the crossed level. Before opening a certain trade, be sure to take into account all these conditions.
The RSI TC New indicator works equally effectively on any timeframes, using any currency pairs, so the choice of their values is not limited.
Input parameters
The settings of the RSI TC New indicator consist of several sections. The input parameters consist of four items and each of them affects its technical operation to some extent. The Colors section is responsible for its overall color gamut and value thickness, while the Levels section serves to add additional signal levels to the indicator window.
- RSIPeriod - period of the RSI indicator. The default value is 21.
- BullLevel - the value of the signal level of the indicator, which is responsible for the bullish trend in the market. The default value is 50.
- BearLevel - the value of the indicator's bearish signal level. The default value is 50.
- AlertOn - parameter responsible for receiving a notification when the indicator receives a signal. The default value is true.
Indicator signals
In order to open a certain trade using the RSI TC New indicator, it is first needed to determine the current trend. To do this, it should be waited for the desired combination of conditions to appear, based on the color of the main indicator line, its direction, location and intersection relative to signal levels. If the conditions characterize an upward trend - open long positions, if the trend is down - short positions. Close any trades should be on the same conditions, in the opposite direction.
Signal for Buy trades:
- The indicator line, colored with the growth value, moves up, crossing the level 50, indicated by a line of dots.
Upon receipt of such conditions, a buy trade may be opened on a signal bullish candle, due to the presence of an uptrend in the market. Such a trade should be closed after the indicator line starts moving down and falls below the level of 50. In this case, one should consider opening new trades, as how is it possible to change the current trend.
Signal for Sell trades:
- The indicator line moves from top to bottom, falling below the signal level 50, indicated by the line of dots, while it has a color with a falling value.
A sell trade can be opened immediately after receiving such conditions on a signal bearish candle. Such a trade should be closed when the direction of the line changes, namely after it rises above level 50. At this moment, a change in the current downtrend is possible, which makes it possible to consider opening new positions.
Conclusion
The RSI TC New indicator is a very effective trading algorithm based on accurate indicators. It serves as an excellent assistant in determining the current trend and trading in this period, while it can also be used to determine if the market is in the overbought or oversold zone. It is very simple and easy to use, and suitable even for beginners who are recommended preliminary practice on a demo account.
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