jamboree
3 posts
msg #36899
- Ignore jamboree |
7/13/2005 11:44:54 AM
I'm trying to validate the equation for RSI(2), but it looks like i'm getting more RSI=0 than SF is actually presenting...
In other words, whenever 2 consecutive days are up, my average loss (RS denominator) is 0...looking at the RSI formula below:
100-(100/(1+RS))
RS = Avg Gain/Avg Loss
Am I forgetting something? Isn't it correct to assume that 2 days up in a row automatically represent an Avg Loss = 0, therefore, RS =0, bringing the RSI formula to:
100-100 = 0...
Any help is more than appreciated...
Thanks...
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jclaffee
81 posts
msg #36904
- Ignore jclaffee |
7/13/2005 12:57:29 PM
jamboree. . .
If your average loss is zero, then RS becomes undefinably large as does
(1 + RS). . .[100/(1 + RS)] approaches zero and RSI approaches 100.
The RSI(2) < 1 approach is a bottom-fishing reversal system and wallman's original work required three down days with one of those at high (capitulation)volume to trigger.
Check it out in the archives "bollinger bands".
Jim
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jclaffee
81 posts
msg #36905
- Ignore jclaffee |
7/13/2005 12:59:51 PM
A senior moment here!!
I'm fully aware that Holy Grail is the originator of the RSI(2) < 1 technique and I must be going round the corner (as my wife has charged for some time)!
Jim
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jamboree
3 posts
msg #36907
- Ignore jamboree |
7/13/2005 4:02:54 PM
thanks jclaffee!
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