The RSI Monitor Indicator For MT4
Table Of Contents:
- The RSI Monitor Indicator For MT4
- The RSI Indicator
- Settings of the RSI Monitor Indicator For MT4
- Advantages of the RSI Monitor Indicator For MT4
The RSI Monitor Indicator For MT4 is a great tool for every trader. It can help you to easily get a quick understanding of the current market behavior on all timeframes. The origin of the indicator is the RSI indicator, which is easily one of the most used indicators. While the RSI indicator on a single timeframe is already very powerful, a combination of multiple timeframes adds a lot more power to it. This can easily be achieved with the RSI Monitor Indicator For MT4, because you can see the RSI values for multiple timeframes at once and in one spot.
In this article you will first learn about the RSI indicator and how it can be used. Following that I will shortly explain the settings of the RSI Monitor Indicator For MT4. At the end I will show you how this indicator can help you to bring your RSI-based trading performance to the next stage and transform you into a profitable trader.
The RSI Indicator
The RSI indicator is typically used to spot oversold and overbought zones in the market. Many Traders then use these zones to enter the market at a very good price level and make profits. In the above image you can see the standard RSI indicator on the 1hour chart of GBPUSD. The indicator consists of three horizonal lines and the RSI line.
The middle line is right at the 50 mark and thus is seen as a middle line. This line is often used as a bounce spot in trending markets. With that in mind, everything above the upper horizonal line is seen as overbought while everything below the bottom line is seen as oversold. These oversold and overbought zones are then used by traders enter the market at a great price. This means they are looking for buy trades in the oversold zones and for sell trades in the overbought zones.
In the above picture you can see exactly how such a RSI based strategy could work and how strong the indicator is. However as you can see, not all movements were strong and some retraced against the setup soon after the entry. In order to filter out these setups that do not produce very strong movements one can combine the RSI from this single timeframe with the RSI on other timeframes. This adds another edge to the setup and secures better trades and less losses at the same time. I hope you can now see the strength of the RSI Monitor Indicator For MT4!
Settings of the RSI Monitor Indicator For MT4
The settings of the RSI Monitor Indicator For MT4 are pretty simple and straight forward. With the settings in the first block you can customize the look and the position of the indicator and set it up however you like it best.
The second block of the settings is probably the most significant one. With these you can change the settings of the RSIs that are used on the different timeframes. If you don’t like the standard RSI period of 14 because you are a scalp trader and require a faster RSI, just change this to a lower value. Some people also don’t like the overbought and oversold lines at 70 and 30 and rather put them at more extreme values like 80 and 20.
With the last settings block you can set up the alerts of the indicator. If you enable them, then the indicator will send you an alert once it detects an entry into the oversold or overbought zone on any timeframe.
Advantages of the RSI Monitor Indicator For MT4
Like I told you above, the RSI indicator on its own is already quite powerful, but if you use it on multiple timeframes it becomes even better. This is where the biggest strength of the RSI Monitor Indicator For MT4 lies. You can combine all the timeframes at once and find the greatest trading opportunities this way.
An example of a great strategy is to wait first wait for an extreme oversold or overbought price on a higher timeframe chart, like maybe already the 1hour timeframe. Once you spotted this, or rather received an alert by the RSI Monitor Indicator For MT4, you then just wait for a lower timeframe to also enter an oversold or overbought area. Now you have combined two edges and can enter the trade with confidence.
As you can see, another big advantage of the RSI Monitor Indicator For MT4 is that it can send you alerts. This can save you a LOT of time! You don’t have to be in front of your charts all day but just wait for a notification about a potential setup by the indicator and then place your trades accordingly.
I also really like that all the features of the indicator can be customized and it can be placed where ever I like it on my charts so that it doesn’t disturb me from doing other stuff like technical analysis.