The Strategic Trader
Detailed Strategy Evaluation

RSI Part 3 – Threshold Cross

In this article we aim to discover the significance of actually crossing a threshold. Because RSI is a momentum based indicator it stands to reason that the actual act of crossing a threshold may signal a better trade.

(Comparison Results With RSI Part 2 – Long Only)
Method: RSI(3) < 10
Percent Profitable: 60.36%
Net Profit: +12,100
Trades: 1559

Conclusion:

Requiring an actual cross only seems to decrease the number of trades. Profit factor and percent profitable remain nearly unchanged. Therefore we can conclude that the act of being below a threshold as seen in “RSI Part 2″ is sufficient and that watching only the cross is not required.

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