Laguerre RSI MT4 Indicator – Free MT4 Indicator
The
Laguerre RSI MT4 indicator is a custom indicator based on the traditional
RSI indicator and it can be useful in determining market cycles. But,unlike the RSI indicator which can produce a lot of false signals, the Laguerre RSI
MT4 indicator is a smoothed version that will generate far fewer signals but more accurate. One of the most interesting features of the Laguerre RSI
MT4 indicator is the fact that once it reached extreme
overbought and oversold conditions, it starts flattering and it tends to stay in that condition until the market is ready to reverse. This is also the signal that the current trend is strong and the market will continue to move in the direction of the Laguerre RSI line. Traders are advised not to fade this move as the best way is to wait until the Laguerre RSI line starts moving again.
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The same like with the other oscillator
indicator the Laguerre RSI MT4 indicator moves between two extremes one and zero. There are some fine particularities with the Laguerre RSI
MT4 indicator that needs to be addressed firstly once the Laguerre RSI line reaches 0.15 we consider that we are in an oversold condition, however, once the market goes beyond 0.15 and reaches the zero level, the Laguerre RSI line will flatten and this will not be indicative of an oversold market but it will signal a
strong bearish trend.
Laguerre RSI MT4 indicator
Conversely, once the Laguerre RSI
line reaches 0.75 we consider that we are in an overbought condition, however, once the market goes beyond 0.75 and reaches the 1 level, the Laguerre RSI line will flatten and this will not be indicative of an overbought market but it will signal a strong bullish trend.
Laguerre RSI MT4 Indicator Settings
Laguerre RSI MT4 Indicator Settings
The Laguerre RSI
MT4 indicator has only one parameter the gamma multiplier which has the default setting of 0.7. The gamma multiplier is the coefficient for calculating the level of the Laguerre RSI line. A lower gamma number than 0.5 will have a negative impact as the
indicator will generate a lot more signals that ultimately will make the Laguerre RSI MT4 indicator unreliable while a gamma multiplier higher than 0.85 will make the signal lag far behind the price. In conclusion, it’s best to use the default settings.
Laguerre RSI MT4 Indicator Trading Rules
This is a great tool that can be used both for
trend trading as well as catching reversals. In the first case we’ll enter the
market once the Laguerre RSI line become flatter and we’ll need to wait for at least 3 candlesticks to pass in order to have our confirmation and we’ll buy or sell accordingly using a static protective stop loss order of 40 pips and exit the trade once the Laguerre RSI line starts trading again.
Laguerre RSI MT4 Indicator Trading Rules
Secondly, we can use the Laguerre RSI MT4 indicator for trading reversals and in this regard, we have to look for the Laguerre RSI line to get extreme and start flattering and wait for the Laguerre RSI line to start trading again, once this condition is met we can safely buy or sell accordingly using a
protective stop loss 10 pips above/below the most recent swing high/low and we can take profit once the Laguerre RSI line reaches the opposite side of the extreme.
Laguerre RSI MT4 Indicator Reversal Strategy
Time Frames
Technically speaking, you can use this indicator for all time frames. However, the shorter the time frame, you will see more fluctuation and possibly more whipsaw which may cause small losses that can eat up your portfolio quickly. We recommend that you use higher time frames like the 4H for better consistency.
Laguerre RSI Strategy Video
Laguerre RSI Strategy Video
Laguerre RSI MT4 Indicator Download
We have provided this powerful
trend trading indicator to you at no cost. We humbly request for your help to spread the word by sharing on one of the social platforms below. To unlock the
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Leave us a comment below to let us know your thoughts on this indicator. If you like this indicator, you might like see other indicators that we have carefully selected that will help you in your trading journey.
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