Thread by @learntotrade365

Twitter space by @bankniftydoctor

Topic - Understanding Trend and direction using RSI & ADX

Twitter Thread 🧵 of all the data points shared by Dr.Jignesh Shah during twitter space is complied

Retweet to reach wider because Learning should never stop

#StockMarketindia
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https://twitter.com/learntotrade365/status/1485951702415003649

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RSI shows strength

RSI above 50 buyers dominating
RSI below 50 sellers dominating

RSI above 55 Long Bias
RSI below 45 Short Bias

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Trading timeframe Daily/Hourly

Bullish Bias:

Daily RSI above 50
Hourly RSI above 55

Bearish Bias:

Daily RSI below 50
Hourly RSI below 45

For exit on Bullish entry RSI close below 45 & On Bearish entry RSI close above 55

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To decide position

Bullish Bias:

Example 1 :If a stock has RSI 55 & other has RSI 60 - Better to choose RSI 60 stock.

Example 2 : If a stock has RSI 65 & other has RSI 70 - Better to choose RSI 70 stock

Vice versa for bearish bias

Higher the RSI more conviction

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To identify Momentum

Total 4 categories
- Mild (RSI 55 to 60) 25% position
- Moderate ( RSI 60 to 65) 50% position
- Strong (RSI 65 to 70) 75% position
- More Strong (Above 70) 100% position

Vice versa on bearish bias

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ADX indicator has 3 lines ADX , ADX+ or DMI+ , ADX- or DMI-

Cross over example:

DMI+ is above DMI- favours long trade ( Vice versa )

Only by combining RSI & ADX

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RSI + ADX = Double Confirmation

More the distance/difference between DMI+ to DMI- gives better outcome.

Difference of
10 - Better
15 - Much better
More than 20 - Strong

Bigger the difference and RSI also at higher levels like above 65 more conviction

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End of the thread from twitter space by Dr.Jignesh shah.

Make sure to retweet the first tweet and make use of this learning to improve your trading style if u are using RSI & ADX indicators