[RCI3 Three-Line + BODSOR] USD/JPY Daily Chart Retracement Sell Signal

※BODSOR is an indicator developed to improve the entry accuracy when executing breakout buying or pullback selling using three RCI lines.




RCI Three Lines and BODSOR practical examples

One of the features of the RCI three lines (RCI9, RCI26, RCI52) is

“When the three RCIs line up in the same direction, price movement in that direction tends to be stronger.”

This is one of the characteristics.

When RCI26 and RCI52 are rising (or falling) and RCI9 is falling (rising),
if RCI9 reverses“All three RCIs line up in the same direction”,

then the price movement in that direction is expected to be strong.

Therefore, detecting when RCI9 will reverse is extremely important.（Case by case, simply waiting for a confirmed reversal of RCI9 often leads to significant delay.)


Thus, BODSOR was developed to detect as early as possible the timing when the momentum of the rise (or fall) of RCI9 weakens.
This is the purpose of BODSOR.


The figure below is a daily chart of USD/JPY.

USD/JPY Daily

Top panel:BODSOR
Bottom panel: RCI Three Lines (red: RCI9, light blue: RCI26, yellow: RCI52)

Among the three RCIs, only RCI9 is clearly rising.
If RCI9 reverses downward, all three RCIs may align in a downward direction.
In other words, price could also experience a strong decline.

In such a situationBODSOR pullback selling signal (yellow arrow) lights up.

From the moment the signal lights, the price declines steadily as you can see.

In this example, the candle two bars before the candle that confirms the reversal downward of the rising RCI9 is when the pullback selling signal is confirmed to light.
The pullback selling signal is confirmed when that candle closes.




Using the RCI Three Lines to perform pullback buying or pullback selling
to improve entry accuracy


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