Today I gonna tell you about some tool, that will be really a good help in your trading. Frankly speaking, I think that it can easily become a base for the whole trading strategy, working on different timeframes. So, what is that nice thing? It is called RVI indicator, and not many people are talking about it and even less know how to use it. If you type the letters RVI in a search engine, you want get many information about methods of implementing that indicator, but just a short description.

At this rate I decided to show, how it is better to use this wonderful tool and what are the special points to be taken into consideration while dealing with it. I implemented the indicator on EUR/GBP graph on H1 timeframe and started testing it. At the same time I changed the standard frame of the indicator, which is 10, to 14, as it seems to me to be really more convenient and precise. See the picture below for the result.

As you see, the indicator repeats the price and smooth over the “losing” parts of the graph (captured into pink frames), taking them out of your attention, which really cool. It is quite obvious, that the best strategy is to sell when the lines are crossing at the top part of the indicator frame and buy when the cross at the bottom one. And this allows to make the Forex signals really precise.

What is more, I consider it quite logical not only to open, but also to close positions according to RVI. The points, where I entered and quitted the market, are highlighted with the pink arrows. You see, when you open a position at the first lines’ crossing in the top part of the frame and close it at the first crossing in the bottom part, the position will be profitable. And the same situation is with the other graph parts.

At the same time the indicator is capable of showing divergences (2 of them are shown by the lines at the top of the graph). All above-stated means, that RVI is the tool, which is really valuable and can bring you to the success, if you use it carefully and in the proper way. So, just try it out and then share your experience with other traders!