RSI Filtered Forex System
The RSI filtered forex system consists of 2 identical advanced RSI (Relative Strength Indicator) trading indicators. The system is designed to give you great entry points in an existing trend. It’s a typical buy on dips, sell on rallies low risk fx system that can be used on all time frames and currency pairs. You can download this system for free below.
Used MT4 indicators: 2 x RSIFilter.mq4 – add this indicator twice to your chart and use periodRSI: 33 and periodRSI: 14 (see EUR/USD image below)
Preferred time frame(s): any
Recommended trading sessions: London and US session for charts up to the 30 min (good for scalping and day trading). Around the clock trading for 1 Hour charts and above (good for swing trading and long term currency trading).
Currency pairs: any
Example: EUR/USD H1 Chart (click to enlarge image)
The figure above is an example of the RSI filtered system in action on the 1-hour Euro/US Dollar forex chart. It shows our proposed buy and sell entry points (dotted blue line)in an existing trend. A stop-loss will be kept below the most recent swing low point for buy trades and above the most recent swing high point for sell trades.
RSI Filtered System Trading Rules
- RSI Filter (period 33) orange color (bullish trend).
- RSI Filter (period 14) turns orange from blue color.
==> Open buy trade. Place your stop-loss below the most recent swing low point.
Trade exit (TP): (1) Set your own profit target (based on your own TP method). (2) Wait for the short-term RSI filter (14) indicator to turn back to blue color from orange to close your buy trade. (3) Wait for an opposite trading signal (see sell conditions).
- RSI Filter (period 33) blue color (bearish trend).
- RSI Filter (period 14) turns blue from orange color.
==> Open sell trade. Place your stop-loss above the most recent swing high point.
Trade exit (TP): (1) Set your own profit target (based on your own TP method). (2) Wait for the short-term RSI filter (14) indicator to turn back to orange color from blue to close your sell trade. (3) Wait for an opposite trading signal (see buy conditions).