The TDI: A Thread 1/8
Many traders will have heard of the RSI yet not so many the TDI.
The traders dynamic index essentially provides us with a premium RSI indicator.
Lets have a look how it works.
#TDI #RSI #crypto #cryptotrading #cryptocurrency
The TDI: Market Base 2/8
Within the TDI we have several elements.
The market base is the slow moving direction of momentum in the market.
From timeframe to timeframe this changes so it is key to check across multiple timeframes.
We can see how price and the market base behave.
The TDI: Bands 3/8
To accompany the market base line we have the bands.
When volatility enters the charts we see these bands expand.
If the bands are tight to the market base we are likely to see a strong move.
The TDI: RSI 4/8
The white line represents the RSI.
This is key to have within our TDI indicator as we use this to see quicker sharper moves in price.
The RSI will react at the points it meets the bands and the market base.
When outside the bands it will look to re-enter.
The TDI: Market Signal 5/8
The light grey line represents an even quicker RSI.
We use this to support our theory behind quick momentum.
The RSI (white line) will use the signal line as support in strong moves.
This line is really a quick momentum indicator.
The TDI: Three touches 6/8
When price looks to make a bottom or top formation it can occasionally do this with three touches.
Our TDI helps us identify when momentum is switching and allows us to eye an early entry.
Here we have an example where price pushes to the lows...
The TDI: Three touches 7/8
Price wicks the lows three times.
Whilst this occurs look at how the TDI moves. We see the clear divergence on the RSI, we see the RSI move from outside of the volatility band inside for the second spike.
The TDI: Three touches 8/8
When the third touch comes in we see the RSI move to test the market base, when it fails to break we have the TDI showing us a strong entry signal.
This same signal can be found across all timeframes.
The TDI settings are attached here!
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