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RSI Swing Failure Stock Trading Setup

RSI stock trading swing failure can be a very accurate method for trading short term stock trading moves. It can also be used for trading long term stock trends but it is best suited for short term stock trading especially for those stock traders that trade reversals.


The RSI swing failure swing stocks trading setup is a confirmation of a pending stock market reversal. This stock trading swing failure setups a leading breakout signal, it warns that a support or resistance level in the stocks trading market is going to be penetrated. This stocks trading setup should occur at values above 70 for an upward stock trend and values below 30 in a downward stocks trend.


Swing Failure In an Upward Stock Trend

If the stock trading RSI Stock Indicator hits 79 then pulls back to 72, then rises to 76 and finally drops to below 72 this is considered a failure swing stock trading RSI setup. Since the 72 level is an RSI support level and it has been penetrated it means that stocks price will and follow and it will penetrate its support level.


In the stocks trading example explained below, the stock trading RSI indicator hits 73 then pulls back to 56, this is a support level. The stock indicator then rises to 68 and then drops to below 56, thus breaking the support level. The stocks price then follows afterwards breaking it support level. The stock trading RSI swing failure is a leading stock signal and it is confirmed when stocks price also breaks it support level. Some stock traders open trades once the swing failure is complete while other stock traders wait for stocks price confirmation, either way it is for a stock trader to decide what work best for them.


RSI Swing Failure in an upward stock trend

Stock RSI Swing Failure Setup in an Upward Stock Trend


Swing Failure In a Downward Stock Trend

If the stock trading RSI Stock Indicator hits 20 then pulls back to 28, then falls to 24 and finally penetrates above 28, this is considered a failure swing setup. Since the 28 level is an RSI resistance level and it has been penetrated it means that stocks price will and follow and it will penetrate its resistance level.

RSI Swing Failure in a downward stock trend

Stock RSI Swing Failure Setup in a Downward Stock Trend

 

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