Hi everyone, in this post would disscus how to trade Boom and Crash index markets using just the relative strength index.
First of, you need to set up a 200 exponential moving average with any colour of your choice.
Second thing is to go to the RSI and moving averages.
1- Relative Strength Index
Period: 1
Apply to Close
Choose any style of your choice
Level: 10- Strong Buy
Level: 50- Wait or TP
Level: 90- Strong Sell
2- Moving Averages
i- Period: 5
ii- Shift: 0
iii- Method: Simple
iv- Apply to: Close
v- Style: Green
3- Moving Averages
i- Period: 3
ii- Shift: 0
iii- Method: Simple
iv- Apply to: Close
v- Style: Orange
4- Moving Averages
i- Period: 2
ii- Shift: 0
iii- Method: Exponential
iv- Apply to: Close
v- Style: Red
5- Moving Averages
i- Period 50
ii- Shift: 0
iii- Method: Exponential
iv- Apply to: Close
v- Style: Blue
Main Chart
6- Bollinger Bands
i- Period: 20
ii- Shift: 0
iii- Deviation: 2.00
iv- Apply to: Low
7- Commodity Channel Index
Period: 5
Apply to: Typical Price
Style: Any style of your Choice
Levels : -100 Buy
-140 Strong Buy
100 Sell
140 Strong Sell
How To Trade and Detect Spike in a Boom and Crash Market
1- Figure out the market directions whether uptrend, sideways or downtrend
2- Candles should be around the lower Bollinger's band in case of boom market and close to upper Bollinger's band in case of Crash Market
3- All the moving averages in the RSI should be converged either at the Strong buy level or 10 for the boom market or Strong Sell level or 90 for Crash Market as the case maybe
4- CCI should be below the buy level for boom market and and above the sell level for sell market.
5- For Take Profit once the candlesticks is approaching the higher Bollinger's band for boom market or once it reaches the take profit zone on the Rsi indicator.
The opposite applies to crash market as well in the area of take profits.
6- Last but not least, get off the market as soon as the target to avoid feeding what you get back to the market and avoidance of drawn downs once the spike is caught up with.
That's all as regards the write-up on trading strategy and happy blogging. More would be greatly reviewed in the coming posts.
Happy Blogging and Reading 💥💥💥💥
cross posted from my Blurt account
2436.783 SRY