[Episode 5] "When RCI angles steepen, jump on" is just gambling
This is Pro Trade Coach Max.
This is the fifth installment in a series that cuts through the common knowledge about FX in society. This time, we issue a warning about a very dangerous assumption: entry when the angle of the RCI becomes steep.
While monitoring the chart, when you see the RCI angle suddenly turning sharply upward (or downward), you might hurriedly want to jump on board thinking, “A strong trend has formed!” In short, this method is nothing but gambling.
Indeed, sometimes you happen to be right by riding that momentum. However, overall, it is a verylot of “risk” to take in gambling.
This is because you cannot determine whether that “sharp angle” is occurring at the初動 of a trend reversal or as the last spurt near the end after the trend has already run its course. If you jump on board by looking at the angle of a single line, the probability of getting caught at a high or low price—drawing a bad lottery ticket—rises dramatically.
To increase the probability of consistently winning in the market, you should not be swayed by the near-term sudden angle changes, but rather use multiple RCIs (short-term, mid-term, long-term) to assess the overall market environment.
The long-term RCI forms a certain “shape (Type A, Type B, Type C, etc.)” and, at the current position, what kind of “gravity” it exerts on the market
Precisely performing this “RCI shape assessment” is the essential skill to pinpoint the market’s correct moves.
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Pro Trade Coach Max