Here I am trying to use the very popular indicator RSI in a different manner. What if you use the difference between 2 different daily RSI? Here I am using the difference between the 6 day and the 2 day RSI, It works on many other daily parameters as well.
The trading vechicle in this is the popular ETF SPY. SPY is an ETF that tracks the popular SP500 index. This idea can be used on many different markets and stocks either on its own or together with more filters. A nice tool in the toolbox in other words.
Baseline Model Rules (Are you interested in code and workspace for Tradestation?)
- When the difference between a 6 day RSI and a 2 day RSI is above 30 you long at close.
- Exit: When the difference between the 6 day RSI and the 2 day RSI is equal or below zero then exit at close.