Combining the Reversal Indicator With the RSI.
Creating a Strategy Based on Rob Booker’s Reversal Indicator With the RSI.
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Combinations of strategies may offer better opportunities. We can combine indicators together so that we get an extra confirmation factor. In this article, we will see how to use the RSI alongside the Rob Booker’s reversal indicator.
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The Reversal Indicator
Some less-known indicators actually function pretty well. Among those indicators is Rob Booker’s Reversal Indicator which uses a special combination between the MACD oscillator and the stochastic oscillator. The reversal indicator is an overlay indicator based on arrows created following some rules on the MACD and the Stochastic oscillators:
- For a long (Buy) reversal signal, the MACD oscillator with its default parameters must surpass the zero line while the 10-period simple moving average of the 70-period stochastic oscillator is below the lower barrier 30.
- For a short (Sell) reversal signal, the MACD oscillator with its default parameters must break the zero line while the 10-period simple moving average of the 70-period stochastic oscillator is above the upper barrier 70.
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