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southern illinois | I am a big believer in watching the RSI as a tool of confirmation when I'm watching prices. On this recent run-up we did not see the RSI diverging as prices made their advance. On the flip-side look at the RSI when we made the new lows in late June. The bean market plunged about 50 cents in 5 days to new recent low but the RSI did not go to new lows..warning this market may be turning. It is just one more tool, but I will watch it closely on another run-up. The divergence will often coincide with a reversal bar on the daily or weekly. The market often gives us a second chance to sell against a high on a 60% or 70% retracement after seeing the divergence as a red flag. Nothing is perfect, but this is a simple indicator that carries a lot of weight IMO. | |
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Okay serious question.
