RSI - 5 Star Rating Strategy by Vishal B Malkans, Malkansview

Relative Strength Index is known as RSI a trading tool used by many investors. In this video, Vishal Malkan shows us all about unconventional RSI which can help you break the rules, but it is important to know all about conventional RSI first.

The starting point is to look at the Range Shift, which looks at the 40-80 index in a bullish market, while in a bearish market they follow a 60-20 index. If we analyse a chart where the trend has moved from bullish to bearish with the above-mentioned index levels and doesn’t cross the 40 range, it is an indicator it is no more bearish. The logic being bullish range is 40-80 as per this unconventional Range Shift. To simplify it in a bullish market the RSI won’t go below 40 and in a bearish market, the RSI won’t go above 60. This serves as an indicator to enter and exit stocks and debunks the overbought and oversold trends during technical analysis.

The points are scattered from 1-10 as you can see in the pictures which show the uptrends and downtrends.

The thumb rule one can follow the basis of this chart:

Apart from the unconventional RSI strategy, there is also a 5-star trading strategy for a long buy. Here we look at the charts from Daily, Weekly & Monthly, range again here being between 40-60 where Weekly and Monthly trends will impact the daily trends creating an inflection point. The inflection point is visible in the candle bar visual moment you notice a green candle after several red candles. When a stock fulfills all the criteria of staying above 40 and stays close to 60 or above it can qualify as a 5-star trading option. Weekly RSI is above 60, Monthly RSI staying above 60, and Daily RSI near 40 and not below 40. To summarize strong stocks will always be above 60 and good buying opportunities will come when they hover near 40.