The Laguerre RSI NG is a trading algorithm based on the functioning of several indicators, namely the standard RSI using Laguerre and an additional filter. Its calculations are aimed at determining the direction of the current trend and its strength, as well as trading during this period. At the same time, the indicator can also be used to determine when the market is in the overbought or oversold zone. It is represented in the bottom window of the price chart as a solid line that changes its color and direction under certain market conditions. The current values of the line are used to determine the current market movement and trade in this period directly.
The Laguerre RSI NG indicator is suitable for trading on any timeframe using any currency pairs.
There are several sections in the settings of the Laguerre RSI NG indicator that are responsible for its general functioning. The Input parameters section is used for its technical work, the Colors section is used to change the color scheme and general visualization, and the Levels section is used to add signal levels to the indicator window.
-Laguerre RSI period - indicator calculation period. The default value is 32.0.
-Price - type of the price to which the indicator calculations are applied. By default, it has the Close price value.
-Smoothing period (<1 for no smoothing) - calculation smoothing period. The default value is 1.001.
-Level up - value of the upper level of the indicator. The default value is 0.85.
-Level down - lower signal level of the indicator. Default value is 0.15.
To open a certain trade using the Laguerre RSI NG indicator, it must be first determined the current trend, namely its direction and strength, which in turn are determined taking into account the direction and color of the indicator line, as well as its location relative to signal levels. If the indicator determines a strong upward trend, long positions are opened, if the trend is downward, short positions are opened. At the moment the current trend changes, in both cases, trades are closed.
Signal for Buy trades:
- The indicator line is directed upwards and, crossing its upper signal level, is colored with the value of growth.
Upon receipt of such conditions, a buy trade can be opened on the signal candle due to the presence of an upward trend in the current market. It should be closed and a new one should be considered when the current trend changes, namely at the moment of changing the direction and color of its line.
Signal for Sell trades:
- The indicator line is directed from top to bottom and crosses its level of 0.15. The line is colored with a falling value.
A sell trades can be opened upon receipt of such conditions that characterize the presence of a downward trend. The trade should be closed upon receipt of the opposite conditions from the indicator. At this moment, it can be considered opening a new trade due to a change in the current trend.
Laguerre RSI NG is a very effective trading algorithm, the calculations of which are based on the interaction of precise indicators. To improve the accuracy of the indicator signals, it is recommended not only to use it on a demo account, but also to use it with additional indicators, advisers and tools.