The Safe Money System

How to Use RSI Setting in Chart and Indicator: A Simple Guide for You!

Hey buddy! If you’re into trading, you’ve probably heard about RSI (Relative Strength Index). It’s one of the most popular indicators traders use to predict market trends. But if you’re confused about how to set it up and use it properly, don’t worry—I got you! Let’s break it down in the simplest way possible, like we’re just chilling and talking about trading over coffee. ☕

What is RSI?

Alright, before we jump into the settings, let’s quickly understand what RSI actually does.

RSI is a momentum indicator that helps you figure out whether a stock, crypto, or forex pair is overbought (too expensive) or oversold (too cheap). It moves between 0 to 100, and here’s the golden rule:

  • Above 70 → Overbought (price might drop soon)
  • Below 30 → Oversold (price might rise soon)

Sounds easy, right? Now, let’s set it up on your chart!

How to Set RSI in Your Trading Chart

Whether you’re using TradingView, MetaTrader, or any other platform, the steps are pretty similar:

  1. Open your trading platform – Fire up your favorite charting tool (I personally love TradingView! It’s clean and easy to use).
  2. Go to Indicators – Look for the ‘Indicators’ tab at the top of the screen.
  3. Search for RSI – Type ‘RSI’ in the search bar, and it should pop up.
  4. Click to Add RSI – Boom! It’s now on your chart.
  5. Adjust Settings – By default, RSI is set to 14-period (which is good for most traders), but you can tweak it based on your trading style.

Best RSI Settings for Different Trading Styles

Now, the default 14-period RSI is fine, but depending on your strategy, you might want to change it:

  • For short-term (scalping & intraday trading) → Use 7 or 9-period RSI (reacts faster)
  • For swing trading (few days to weeks) → Stick with 14-period RSI (balanced approach)
  • For long-term trading → Use 21 or 25-period RSI (slower but gives strong signals)

How to Use RSI for Trading

Now that RSI is set up, let’s talk about how to use it to make better trading decisions.

1. Overbought & Oversold Zones 📈📉

  • If RSI goes above 70, the price might be too high, and a drop could be coming. Time to watch for a sell!
  • If RSI goes below 30, the price might be too low, and a bounce might happen. Time to watch for a buy!

2. RSI Divergence 🔄

  • If the price is making new highs, but RSI is going lower → Warning! A trend reversal may happen.
  • If the price is making new lows, but RSI is going higher → Chance for a bullish reversal!

3. RSI + Moving Average Strategy

  • Combine RSI with moving averages for better confirmation.
  • Example: If RSI is below 30 AND price touches a 200 EMA support → Possible strong buy signal!

Final Thoughts

RSI is super useful, but don’t use it alone. Combine it with support & resistance, moving averages, or trend lines for better accuracy.

And remember, no indicator is 100% accurate—always use proper risk management. Set stop-losses, don’t chase the market, and most importantly, trade smart, not hard! 🚀

Hope this helps, my friend! Happy trading! 📊💰

Enjoy Some latest Business Ideas by some Enterpreneurs : Dark Motivational Blogs

Can I use RSI alone for trading?

Nope! RSI is powerful, but it works best when combined with other tools like support & resistance, moving averages, and trendlines. It helps confirm signals, not predict them alone

What is the best RSI setting for beginners?

The default 14-period RSI is the safest choice for most traders. If you trade short-term (scalping), try 7 or 9-period for faster signals.

How do I know if RSI is giving a false signal?

If RSI crosses 70 (overbought) or 30 (oversold), but there’s no strong price movement or confirmation from other indicators, it could be a false signal. Always double-check with trendlines or moving averages.

What’s the best time frame to use RSI?

It depends on your trading style:
1-5 min chart → Scalping (use RSI 7-9)
15 min – 1 hr chart → Intraday (use RSI 14)
Daily chart → Swing trading (use RSI 14-21)

Can RSI be used for crypto trading?

Yes! RSI works in stocks, forex, and crypto, but crypto markets are more volatile. Use lower RSI periods (7-9) for quick signals and always check the bigger trend before making a move.