RSI Indicator Chart Patterns and Forex Trend Lines
Forex traders can plot trend lines on the RSI in the same way as you can plot trend lines on the price charts. RSI trend lines are plotted the same way forex trend lines are plotted on the forex trading chart; by joining consecutive highs of the RSI indicator or consecutive lows on the RSI forex Indicator.
RSI Trend Lines and Forex Trend lines on Forex Trading Charts
RSI Chart Patterns in Forex Trading
RSI Chart patterns such as head and shoulders chart patterns or triangle chart patterns that are not evident on the price chart are often formed on this RSI indicator.
RSI indicator also often forms chart patterns such as head and shoulders or triangles chart patterns that may or may not be visible on the price chart. As shown on the forex chart below the Reverse Head and Shoulders reversal formation is clearly shown on this forex RSI indicator.
Chart Patterns on RSI Forex Trading Chart Indicator
Support and Resistance Levels Trading using RSI Indicator
Sometimes forex chart levels of support and resistance levels are demonstrated better on the RSI indicator than on the price chart.
In an upward forex market trend the support levels should not be broken at any one time, if they are broken then price will also break the support levels and the upward trend is going to reverse.
In a downward trend the resistance levels should not be broken, if they are broken then price will also break the resistance levels, and the downward trend is going to reverse.
Support and Resistance Levels on RSI Indicator
In the example above when the third resistance level was broken the downward trend reversed to an upward trend and when the sixth support was broken the upward forex market trend reversed and broke the upward trend line.