At the time, the famous economist Eilers has developed an indicator that was called Index of relative cheerfulness. It is representative of the oscillators. But unlike his fellow data Binary Options Indicator It does not have zones of overbought and oversold. main feature RVI It is that it shows the strength and duration of the trend. It is calculated on the closing price and the price band.
Rђ RІRѕS, Index of relative cheerfulness a live graph:
In a separate window, we can see two curves. One of them - slow (red), It shows the strength of the market price for a long period of time. A second curve - fast (green), It displays the balance of the price for a small period of time.
Indicator Relative Vigor Index It provides a good and simple signals. To their quality was even higher, I recommend using this indicator with other instruments Technical Analysis.
Signals indicator RVI:
- We can determine the direction of asset prices in the direction of the curved lines of the indicator. They tell us if the market remains the current trend. So watch out, if the lines go up, so the upward trend is maintained, and you can open an option CALL. If the lines go down, it means that the downward trend persists, and you can open an option PUT.
- There is a second type of signal. If a fast curve (green) crosses the slow (red) from the bottom up, it is a signal to buy option CALL. If a fast curve (green) crosses the slow (red) from top to bottom, it is a signal to buy option PUT.
As you can see light Relative Vigor Index easy to use and very visual. Difficulties should not have even the novice binary options.
Translated from English, the word Relative Vigor Index means the cheerfulness index. He is little known among novice traders, and for the most part they pass by him. And absolutely nothing! Since it contains great potential.
Visually, many compare it with the classic Stochastic, but they have one big difference - the Relative Vigor Index does not have any overbought and oversold levels.
They have significant differences in the algorithm itself. The Vivacity Index compares the levels of closing and opening of candles, and the Stochastic - the maximum and minimum price values for a specific period of time.
Because of this, the Relative Vigor Index is able not only to determine the direction of the trend, but also its strength.
During the market analysis, attention should be paid to the location of the lines relative to each other. If green is above red, this indicates the predominance of buyers in the market, which leads to an increase in prices. If red is higher than green - on the contrary, sellers dominate the market, and the price goes into a downtrend.
Well, the intersection of lines, respectively, speak of a change in the trend to the opposite.