The Gold Silver MT4 Indicator basically is an improved version of the RSI oscillator indicator. This is a multi-market RSI because on top of the traditional RSI line that shows the momentum we have two additional RSI lines that can help us better gauge the current market momentum and spot oversold/overbought conditions in the market. We can trade using the Gold Silver MT4 Indicator on shorter time-frames catching the small price oscillations and at the same time using it for larger time frames catching the big swings.
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The preferred settings for the Gold Silver MT4 Indicator are the default settings. The default setting of the multi RSI Gold-Silver indicator is 14 periods which is ideal for trading short-term overbought/oversold conditions.
So when is a good time to enter into position?
The preferred time frame is the 5-minute chart. However, we first need to establish our directional bias using the daily time frame. We’re going to take only short positions on the 5-minute chart if on the daily time frame we can spot overbought readings. Conversely, we’re going to take only long positions on the 5-minute chart if on the daily time frame we can spot oversold readings. A reading above 65 of the RSI Gold-Silver indicator is considered overbought, and a reading below 35 is considered oversold. On the 5-minute chart, we’re going to wait again for the RSI Gold Silver MT4 Indicator to reach extreme overbought/oversold condition before opening a trade at the market price.
And when is the best time to exit or take profit?
If we’re in a long position than we’re going to exit our trades once the RSI Gold Silver MT4 Indicator moves into overbought conditions on the 5-minute chart. Conversely, if we’re short then we’re going to exit our trades once the RSI Gold Silver MT4 Indicator moves into oversold conditions on the 5-minute chart. You’ll have to wait for the 5-minute candle to close before exiting the trade.
How about the Stop Loss level while using the Gold Silver MT4 Indicator?
Defining your risk is always the most important aspect of your trading plan and in this regard having a good place where to place your stop loss should always be of higher priority. Since the RSI Gold Silver MT4 Indicator is helping us to spot reversal points in the market, we want to place our protective stop loss closer to the market price and the most recent 5-minute swing high/low is a good invalidation level. For long positions, we’re going to place our SL below the most recent 5-minute swing low, while for short positions, we’re going to place our SL above the most recent 5-minute swing high.
By using the power of multiple time frame analysis and with the power of the RSI Gold-Silver indicator we’re able to discover in advance potential reversal points and successful scalp the market in a very mechanical way and most importantly profitable way in the long run.