1. usually RSI make bottom in the sell off day, and on the
second day it will be up in the morning. Do you think we should set
buy before the end of the first day (sell off day)?
2. When we use RSI 2 do you think we have to use stop loss? If
yes, then how to set it?
3. In a uptrend stock, usually there is a large posibility for
RSI2 to be successful, usually the RSI2 may not reach 3%, but for a
down trend stock this 3% can be easily reached but the success is
not as good as an uptrend stock. Do you have any comments?
gyzhao- make sure
to do a blog search on the RSI 2 systems, use the key words 'RSI 2,
or RSI 2 system', as well as a google search. You need to read up
about these type of systems so that you understand them.
here's a
writeup on Stockcharts.comthis one uses a cross over of the 5 SMA. I've posted
versions that exit over the 5 SMA, the 8 or 9 SMA, or via the RSI
getting back to a certain level such as 80% on the GDX. Again
lots of variations out there.
also here's
another version that I posted a while back, it shows a scale in version. There are multiple versions of
these types of systems, they were popularized by Larry Conners in a
book. I have custom code that I had a programmer write for me
so that I can test multiple combination of factors.
The stockcharts.com page discusses this, generally these types
of systems don't use stops because the the stops generally give
worse results to the systems. What generally happens is that
bad trades get stopped out on a bounce vs getting stopped out at a
low. However that said, I would look for filters to ignore
trades or stop out bad trades, like anything nothing is perfect and
neither are these systems. Systems like these are called
revision to the mean systems. Generally these systems employ
a long term MA like the 200 day MA that is the dividing line
between taking shorts and resistance. For example when price
is over the 200 day MA and RSI 2 get's oversold, go long, and short
when price is below the 200 day MA and RSI get's overbought.
For my RSI GDX post, I didn't use a long term MA, I simply
tested what are the odds of getting a bounce if RSI closed below
3%. When I uses a 200 day MA, there are too few trades to be
statistically meaningful, only 10 trade.s Again I only posted
it yesterday because RSI 2 closed below 3% for statistical
purposes
As far as employing a stop, you can choose to employ some kind
of stop, but I cannot tell you what that is. I simply posted that
system yesterday because a member pointed out that the RSI 2 on GDX
was very low and therefore I decided to post statistics on a
system. My post was more for informational purposes, I was
not suggesting people to go long GDX based off this, it was an
informational statistical post
is the code available ?
GDX RSI strategy, RSI 2 closes below 3, see video and details
Posted by 1800promote on 4th of May 2012 at 08:31 am
Matt...is the tradestation code shared for this strategy?
Matt: 1. usually RSI make bottom
Posted by gyzhao on 4th of May 2012 at 03:36 pm
Matt:
1. usually RSI make bottom in the sell off day, and on the second day it will be up in the morning. Do you think we should set buy before the end of the first day (sell off day)?
2. When we use RSI 2 do you think we have to use stop loss? If yes, then how to set it?
3. In a uptrend stock, usually there is a large posibility for RSI2 to be successful, usually the RSI2 may not reach 3%, but for a down trend stock this 3% can be easily reached but the success is not as good as an uptrend stock. Do you have any comments?
Thanks.
GY
gyzhao- make sure to do a
Posted by matt on 4th of May 2012 at 04:13 pm
gyzhao- make sure to do a blog search on the RSI 2 systems, use the key words 'RSI 2, or RSI 2 system', as well as a google search. You need to read up about these type of systems so that you understand them.
here's a writeup on Stockcharts.com this one uses a cross over of the 5 SMA. I've posted versions that exit over the 5 SMA, the 8 or 9 SMA, or via the RSI getting back to a certain level such as 80% on the GDX. Again lots of variations out there.
also here's another version that I posted a while back , it shows a scale in version. There are multiple versions of these types of systems, they were popularized by Larry Conners in a book. I have custom code that I had a programmer write for me so that I can test multiple combination of factors.
The stockcharts.com page discusses this, generally these types of systems don't use stops because the the stops generally give worse results to the systems. What generally happens is that bad trades get stopped out on a bounce vs getting stopped out at a low. However that said, I would look for filters to ignore trades or stop out bad trades, like anything nothing is perfect and neither are these systems. Systems like these are called revision to the mean systems. Generally these systems employ a long term MA like the 200 day MA that is the dividing line between taking shorts and resistance. For example when price is over the 200 day MA and RSI 2 get's oversold, go long, and short when price is below the 200 day MA and RSI get's overbought. For my RSI GDX post, I didn't use a long term MA, I simply tested what are the odds of getting a bounce if RSI closed below 3%. When I uses a 200 day MA, there are too few trades to be statistically meaningful, only 10 trade.s Again I only posted it yesterday because RSI 2 closed below 3% for statistical purposes
As far as employing a stop, you can choose to employ some kind of stop, but I cannot tell you what that is. I simply posted that system yesterday because a member pointed out that the RSI 2 on GDX was very low and therefore I decided to post statistics on a system. My post was more for informational purposes, I was not suggesting people to go long GDX based off this, it was an informational statistical post
My post was more for
Posted by matt on 4th of May 2012 at 04:14 pm
My post was more for informational purposes, I was not suggesting people to go long GDX based off this, it was an informational statistical post
Matt: Thanks for the answer. I have
Posted by gyzhao on 4th of May 2012 at 05:42 pm
Matt:
Thanks for the answer.
I have to test this system before I can use it.
The modified RSI2 system is only used for price above 200MVA. Thus I am not sure It could be used for GDX. It is way below 200MVA.
Have nice weekend!