About 20 minutes before breaking below 106 yen, USD/JPY, the return-selling signal of "RCI three lines + BODSOR" lights up.
Three-Line RCIandBODSORusage examples
One of the features of the Three-Line RCI (RCI9, RCI26, RCI52) is
“When the three RCIs line up in the same direction, price movement in that direction becomes larger.”
There is such a phenomenon.
If RCI26 and RCI52 are rising (falling) while RCI9 is falling (rising),
when RCI9 reverses“the three RCIs line up in the same direction”will occur.
Therefore, detecting when RCI9 will reverse becomes extremely important.
(Case by case, but simply waiting for a confirmed reversal of RCI9 often leads to significant late entries.)
Thus, to detect as early as possible the moment when the momentum of RCI9 to rise (fall) weakens
, BODSOR was developed.
The figure below shows an example of USD/JPY on a 1-minute chart.
USD/JPY 1-minute chart
Top line:BODSOR
Bottom line: Three-Line RCI (red: RCI9, light blue: RCI26, yellow: RCI52)
Among the three RCI lines, only RCI9 is rising.
If RCI9 reverses downward, all three RCI lines may move downward.
In other words, price may also fall strongly.
In such a situationBODSOR's pullback sell signal (yellow arrow) lights up.
After BODSORsignal lights up, it reverses only by a few pips, so
in this case, it functions well as a pullback sell signal.
Indicator that displays pullback buying and pullback selling signals【BODSOR】