%% Good points; RSI could easily be cut out+ i do cut that one out. Even when a [Jack Schwager top trader] fund manager found a seldom use for RSI] I may use PSAR[parabolic stop + reverse, aka parabolic time price]once a year,or less, so mostly useless stuff can be used LOL.[NOT an ad for RSI ] I got in , before Time Inc Takeover of Warner Bros,1989 WSJ. Fortune Magazine names it 1989, that sounds right, even when Time Inc owned Fortune magazine.One bad thing about RSI it gets out of trend way to often ; but PSAR also gives plenty of false signals. LOL
I am not quite sure of how RSI gets out of trend? My study of RSI might be different on how it is viewed by most who use it in different way or what is written on how to use it? My opinion is strength of a move or lack of strength of a move regardless of trend, and this is defined by slope of the RSI itself. I think most and including me at one time saw RSI to show divergences based on what was considered ongoing trend, but suppose we take away the trend, being I am a scalper for intraday and I trade noise regardless of trend at times. So if the move of the RSI is steep, it could be said in larger timeframe it is a correction/rally to sell in downtrend of different timeframe. But the smaller timeframe would be opposite- but the problems that come in by defining shorter timeframe as being up, unless one was able to get in near the lows, chances are one be getting in near top of rally to sell. My study last few years has not using this indicator so much as to find divergences(study charting long enough to spot divergences without indicators), but by using the "mean" of drops and rises, example: RSI high is 61 and low is 28, net 33, perhaps over 10 years of data, someone would find this as the mean ave of when to either take profit, or start trailing a stop or anticipate reversal. Or so much "net" one would say mean average of so much and expect "wave 2/4" which are corrections to take a position with your trend. Just can't say to expect reversals at 70/30, but you could study taking the mean average and having better idea of where a trend might end by using the net. So many on this forum say no one ever gives away what is not written in books, but there are actually hundreds of different ways to use charting or indicators but just as important to know what the books offer so we know how the masses are going to get in/out. We know that usually the masses have it wrong, and the masses are trading much lighter volumes. The "few" are trading the heaviest volume of futures and the underlying and options. Always have to keep an open mind.
%% In other words, Handle 123; say the trend lasts 50 days, real tight trend; RSI may signal get out, in 20 or 25 days, not a prediction. OF course if you had to get out in 21 days, 3rd friday ....20 days early could help, but not for me. Actually we don't want all liking the same indicator-market$ would be a mess that way.
Buy funds which are above 50 on the 100-day RSI and above the 200-day SMA. Sell funds which are below 50 on the 100-day RSI and below the 200-day SMA. A fund might recover before the close or have a different RSI on a different source and turn out to be a keeper, so don’t be too hasty to sell. Well, you know it’s a bull market. Short selling is kind of unorganized hit and miss and you don’t get any dividends, so don’t do it except by buying an inverse fund if that’s the best you can find to buy. I got rid of HAO and CUT, but I should have kept CUT.