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The Color RSI with alert indicator is a trading algorithm based on a modification of the standard forex RSI indicator. Its calculations are aimed at determining the current trend and its strength, as well as opening a trade during this period. At the same time, the indicator can also be used to determine the moment the market is located in the overbought or oversold zone. It is represented in the lower window of the price chart as a solid line, which, under certain market conditions, changes its color and direction. At the same time, arrows of a certain color are also formed in the main window of the chart above and below the candles. Depending on the current conditions the indicator determines the direction of the market movement and allows opening a trade taking it into account.
The Color RSI with alert indicator is suitable for trading on any timeframe using any currency pairs.
Input parameters
The settings of the Color RSI with alert indicator consist of several sections. To change the values of its technical work, use the Input Parameters section, to change the general visualization, use the Colors section, and the Levels section, to add signal levels to the indicator window.
-RSI period - period of calculation of the RSI indicator. The default value is 14.
-PriceType - price type to which the indicator calculations are applied. The default value is 5.
-timeFrame - trading timeframe parameter. By default, it has the Current time frime value.
-overBought - signal level responsible for the market being in the overbought zone. The default value is 70.
-overSold - oversold level in the market. The default value is 30.
-showArrows - parameter for the presence of arrows on the chart. The default value is true.
-alertsOn - whether to be notified when an alert is received. Default is true.
-alertsMessage - Option to receive the notification as a message. The default value is true.
-alertsSounds - option to have a sound notification when an alert is received. The default value is false.
-alertsEmail - Alert parameter in the form of an email. The default value is false.
Indicator signals
The Color RSI with alert indicator is very easy to use, not only due to simple visualization and application, but also due to the presence of a notification when a signal is received. Using the direction and color of the indicator line, the current trend is determined, and taking into account it, a certain trade is opened if there is an arrow on chart. If the indicator determines an uptrend, long positions are opened, if the trend is down, short positions are opened. The trend is confirmed by the indicator signal. When the trend changes, trades are closed.
Signal for Buy trades:
- The indicator line moves up and is colored with the growth value. An upward arrow is formed under a certain candle.
Upon receipt of a combination of such conditions on a signal candle, a buy trade can be opened, due to the presence of an uptrend in the current market. The trade should be closed when the trend changes, that is, when the direction and color of the line change. And when a new arrow is formed on the chart, it should be considered opening a new trade.
Signal for Sell trades:
- The indicator line is directed from top to bottom and is colored with the value of the fall. At this moment, a downward arrow is formed on the chart.
A sell trade, due to the presence of a downtrend, can be opened immediately upon receipt of such conditions on a signal candle. When the trend changes, namely at the moment of changing the direction and color of the indicator line, the deal should be closed. And new trades can be opened at the moment the next candle is formed on the chart.
Conclusion
The Color RSI with alert indicator is very accurate, as its calculations are based on the use of an indicator whose effectiveness has been proven over time. The indicator is perfect for use in various strategies that will improve the accuracy of its signals and increase the profitability of a trade.
