RSI - Widely Used, So Misunderstood | Andrew Cardwell | Your Daily Five (01.27.21) — Transcript

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1. 0:19good afternoon folks
2. 0:21uh this is andrew cardwell again some
3. 0:23people say dr rsi
4. 0:25if you're going to talk to me or write
5. 0:26to me just say dear andrew
6. 0:30back with you i did something back with
7. 0:32the
8. 0:33stock charts what six weeks ago back
9. 0:36mid-december
10. 0:39we went through five or six stocks today
11. 0:40we'll try and get through the crb
12. 0:42first which is this chart and i've been
13. 0:45doing this a long time
14. 0:47and i've never seen as much craziness as
15. 0:49i've seen in the last six months to a
16. 0:51year
17. 0:52i mean it's part the
18. 0:54[Music]
19. 0:56pandemic it's part the election it's
20. 0:59part
21. 1:00now the impeachment and you got a little
22. 1:03bit of everything
23. 1:04but the charts will always tell you what
24. 1:07the markets are going to do
25. 1:08if you listen i've been doing this a
26. 1:11long time
27. 1:12uh if you heard me last time i talked
28. 1:14about the fact that
29. 1:16when i started my first 10 years working
30. 1:18at a brokerage firm i found rsi
31. 1:20started we didn't have computers so i
32. 1:23had to calculate the rsi and plot it by
33. 1:25hand put it on graph paper
34. 1:27and the same things i discovered back
35. 1:31then and was using 40 years ago are
36. 1:33still working just as well today
37. 1:36if you've been to my website at cardwell
38. 1:38rsiedge.com
39. 1:41i've got my course information and
40. 1:43everything listed there i've got some
41. 1:45articles listed there
42. 1:47my direct email trader011
43. 1:51at msn.com and i chose that because
44. 1:540-1-1 is the international calling code
45. 1:57when you're making international phone
46. 1:58calls
47. 2:00and most of my clients are outside the
48. 2:02u.s
49. 2:04but one of the things i discovered back
50. 2:06then was
51. 2:08the rsi is probably and i see it still
52. 2:11to today
53. 2:12i've met people who meet me at a
54. 2:14conference and hear my lecture for an
55. 2:16hour
56. 2:17and they say well i follow the rsi i
57. 2:19said well how long you've been doing it
58. 2:20they sell about six months you sell 70
59. 2:22you buy 30.
60. 2:25i said it's much more than that and i
61. 2:27said you can't learn it all in
62. 2:28a one-hour presentation so when i do
63. 2:31these webinars
64. 2:32the one thing i always share is um the
65. 2:35range rules now normally the rsi goes
66. 2:38between
67. 2:3970 and 30 but it's a trending indicator
68. 2:43i don't say overbought or oversold
69. 2:47i call it overextended one way or the
70. 2:49other and bearish diversions and bullish
71. 2:51diversions are not reversal patterns
72. 2:54they're corrective patterns
73. 2:58but after watching markets for 40 years
74. 3:01and trading with the rsi
75. 3:02i'm just glad that i was able to find it
76. 3:04because it
77. 3:05i actually read it from an article back
78. 3:07in june of 78
79. 3:09and i know you the old magazine was
80. 3:12called
81. 3:13uh stocks and comma or futures
82. 3:17and now it's 40 some years
83. 3:21and the rs thigh patterns still haven't
84. 3:23changed it's stood the taste
85. 3:24test of time it's been pretty much
86. 3:28my assistant and does all the work all i
87. 3:31do is sit back and understand
88. 3:33what i've seen for years and watch for
89. 3:35it that's the trading program
90. 3:37you don't have a trading system you take
91. 3:39those to vegas
92. 3:41so this is a chart i showed back in
93. 3:43december
94. 3:45with the crb which i call the
95. 3:48inflation index and i've been bullish
96. 3:50waiting to see inflation come in and
97. 3:52it's starting to come in in the
98. 3:53commodities
99. 3:55crb i first showed back in december
100. 4:01rachel was telling me it was december 9.
101. 4:03this is a weekly chart
102. 4:05so it actually i started talking about
103. 4:07inflation coming back in when i saw it
104. 4:09in
105. 4:11may and june that this was starting to
106. 4:13bottom out turn up i put moving averages
107. 4:15on it
108. 4:16now my range rules which i've gotten
109. 4:18known for
110. 4:19is people are by nature bullish so
111. 4:22instead of 70 and 30
112. 4:24it'll get up to 80 and 20.
113. 4:28for the extreme so all i did was shifted
114. 4:3010 points
115. 4:31and made it the up trends 80 and 40
116. 4:34and made the downtrend 60 and 20.
117. 4:38so here's a weekly
118. 4:41you always want to know what that longer
119. 4:42term time frame looks like
120. 4:44and its trend and then
121. 4:47trade in that direction because the
122. 4:49longer term
123. 4:50time frame one time frame longer than
124. 4:53your trading
125. 4:54is going to have an influence now we got
126. 4:57way down
127. 4:58in march of last year to it below 20.
128. 5:03then we went up through 60 and we did
129. 5:05not go below 40.
130. 5:07then if you look at that after that we
131. 5:09went all the way up above 70 and into 80
132. 5:12back down to 40 but at higher price
133. 5:14levels than it was before
134. 5:16these are what i call the little
135. 5:17positive reversals to where they go down
136. 5:20where the price
137. 5:21is still greater than it was before but
138. 5:22the rsi went lower
139. 5:24got more overextended i see we're down
140. 5:27to like four or five
141. 5:28minutes so this is still positive
142. 5:32and i wanted to share it because i still
143. 5:35see a lot of these commodity prices
144. 5:36moving higher
145. 5:38if we look at ebay because nobody can go
146. 5:42to the mall anymore
147. 5:44they have to stay at home
148. 5:47and there's a daily chart on ebay
149. 5:48showing the same thing
150. 5:50i'm sorry this is crb
151. 5:54let's get ebay back up
152. 5:56[Music]
153. 5:59okay there's ebay
154. 6:00[Music]
155. 6:02and basically it's been rallying
156. 6:06since march of last year up
157. 6:09sideways doesn't dip much below 40
158. 6:11continues to go higher
159. 6:13the stocks are the same way nasdaq
160. 6:16especially
161. 6:17the dollar
162. 6:21normally and i've been around and seen
163. 6:22it a long time normally people will look
164. 6:25for the highest yield they can find
165. 6:28well interest rates have been declining
166. 6:32and the dollar index here
167. 6:35has been in a downtrend it's usually
168. 6:38bullish when interest rates
169. 6:40are rising so this whole time the index
170. 6:43the dollar index was falling interest
171. 6:46rates were still falling
172. 6:49then we've gone sideways and then we
173. 6:51seemed to have bottomed out recently
174. 6:53on a daily chart and we've had it
175. 6:56rallying
176. 6:58which should mean we're expecting higher
177. 7:01rates
178. 7:01in yield and a lot of people are seeing
179. 7:04it go back above one percent it was at a
180. 7:05half a percent has turned higher
181. 7:08so normally when it turns higher the
182. 7:11dollar starts to fall
183. 7:13but the dollar was actually rising
184. 7:16in the last couple of weeks so you have
185. 7:19to look at what the chart says
186. 7:20and forget sometimes the normal inverse
187. 7:23relationship
188. 7:25so there's the dollar may make a little
189. 7:29sideways action for a while but i still
190. 7:31think it's going to go lower i still
191. 7:33have targets this is a us dollar index
192. 7:36trading around 90. i had targets on the
193. 7:39way down at 89.5 to 89.75
194. 7:43it went down but there's no
195. 7:44follow-through now it's going sideways
196. 7:47and a little bit to the upside but even
197. 7:49though interest rates are
198. 7:51rising now the dollars got that behind
199. 7:55it
200. 7:55so look at each market individually i
201. 7:57still expect to see lower prices going
202. 7:59forward
203. 8:00but not as crazy as it's been what was
204. 8:03the other
205. 8:04s p take a look at the s p
206. 8:08stocks are still up for the most part um
207. 8:12dal s p and then the nasdaq is just
208. 8:16on its own it's in its own world
209. 8:19okay smp
210. 8:23still up and we're still still saying
211. 8:26way above the 40 level down here
212. 8:28and every dip has led to a higher bottom
213. 8:31in price and a lower rsi
214. 8:33so i continue to project prices but i
215. 8:35think we are getting a little ahead of
216. 8:36ourselves
217. 8:39so it may you may see it sideways and
218. 8:41they may pull a rug out one day
219. 8:43and see a good 10 correction start so
220. 8:45you have to be very careful
221. 8:47step cautiously
222. 8:50[Music]
223. 8:52soybeans and gold soybeans have been the
224. 8:54leader
225. 8:55in the grains and
226. 8:58most of the grains soybeans wheat corn
227. 9:01they're all going up with the inflation
228. 9:02going up
229. 9:03[Music]
230. 9:04a quick look at soybeans
231. 9:08they're still up they're long term up
232. 9:11that's daily and i always look at weekly
233. 9:13and monthly charts
234. 9:17it's almost parabolic all above the 60
235. 9:20so it's taking out the top of the range
236. 9:22rules on the bear market
237. 9:2460 and 20 in the rsi and staying above
238. 9:2760.
239. 9:28it's like playing a basketball game it
240. 9:30all takes place above the rim as
241. 9:31everybody's
242. 9:32trying to tap it back up into the basket
243. 9:35going forward i just wanted to point out
244. 9:37you're starting to see more commodity
245. 9:39activity
246. 9:40and i think commodities are going to be
247. 9:41the markets to be in
248. 9:44for the rest of this year and we're
249. 9:46going to see inflation
250. 9:47come back and if interest rates stay low
251. 9:50the inflation will send the dollar lower
252. 9:52currencies higher gold and silver higher
253. 9:54and it's going to have a major impact on
254. 9:58stocks too we could see a 10 or 15
255. 10:00percent correction
256. 10:02bitcoin was one that everybody jumped
257. 10:04into but it got extremely overbought got
258. 10:07up near 90 on the rsi
259. 10:09and is reversed we had that big move
260. 10:12down but it's fine in support
261. 10:13[Music]
262. 10:14but uh i'm here to help um
263. 10:18i usually do something here with stock
264. 10:19charts and then i'll do something with
265. 10:21bruce
266. 10:22fraser on power charts but check out the
267. 10:25website
268. 10:26and if i can help you i'm on twitter too
269. 10:30as cardwell rsi and
270. 10:33[Music]
271. 10:35drop me an email i'll get back to you i
272. 10:37want to help
273. 10:38because we thought 2020 was exciting
274. 10:402021 is going to be just as exciting
275. 10:43i'm expecting to see a lot happen that's
276. 10:46going to have markets all over the place
277. 10:48but i'm glad we had some time and look
278. 10:50forward to our next time
279. 10:52take care hey grayson rose here with
280. 10:56stock charts thank you so much for
281. 10:57watching i hope you enjoyed that video
282. 10:59if you did
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