2-Day RSI Alert, a Substitute Blog Post

[nodoodahs]

Server is still down.

According to the Trading Markets methodology, today was "day two," where "day one" closed with a 2-Day RSI of less than or equal to 65, and "day two" closed lower. Their methodology would buy the close on Wednesday if it is lower than Tuesday's, and would exit on the first day that closed with a 2-Day RSI of 75 or higher.

The methodology I've looked at is setting an intraday buy based on a penetration of 2-Day RSI of 10 or lower, and then setting an intraday sell based on hitting a target of 70 or higher. For those that can't watch the chart during the day or can't reliably be at the computer for the close of trading, this allows for the setting of a limit order. The number for the SPX to cross a 2-Day RSI of 10 on Wednesday is about 1427.50, and equivalent declines could be calculated for the SPY, SSO, or futures.

I don't trade these anymore because I would need to throw pretty big percentages of my account behind it and/or use some leverage, as this is pretty much a 3-10 day swing play on the index. I do want to highlight this for those that might be interested.
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I haven’t seen a beatin’ like that since somebody stuck a banana in my pants and turned a monkey loose.

[nodoodahs]

Two different methods. The TM method is enter and exit at close, the other method is one where you set an order based on where the index will cross a threshold intraday, so you don't have to watch the market during the session.
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I haven’t seen a beatin’ like that since somebody stuck a banana in my pants and turned a monkey loose.

[probtrader]

I didn't understand the methodology. You mention these entry rules from Trading Markets:

Yesterday RSI(2) <= 65
Today RSI(2) <= 65
Close(0) < Close(1)

But then you say you looked at intraday buys based on a penetration of the 2-Day RSI of 10 or lower?