Introduction to the COG RSI Indicator
The COG RSI Indicator is, as the name suggests, a forex trading tool based on the Center of Gravity and Relative Strenght Index (RSI).
The indicator is displayed in a sub window placed just below the main trading chart.
This tool uses overbought and oversold market levels to generate trading signals, that are triggered when these values turn from negative to positive and vice versa.
It fits all kinds of timeframes and currency pairs.
The default indicator settings can be modified directly from the input tab. Feel free to experiment with the settings and parameters to fit your personal preferences.
Related: RSI Divergence Indicator MT4
How does it work? How to apply in trading?
Trading Rules Explanation
Signals provided by the COG RSI Indicator shouldn’t cause you any difficulties. Take attention to details and simply follow the suggestions below.
Buy Entry: Open long trade when the RSI drops below 30 level, then reverse and crosses the yellow dotted line. The RSI should be colorized to dark red. Place your stop loss a few pips below last swing low.
Sell Entry: Open short trade when the RSI goes above 70 level, then reverse and crosses the yellow dotted line. The RSI should be colorized to dark blue. Place your stop loss a few pips below last swing low.
Exit Trade / Take Profit: Close your open position when an opposite signal occurs, or use your own preferred method of trade exit.
As always, to achieve good results, remember about proper money management. To be a profitable trader you need to master discipline, emotions, and psychology. It is crucial to know when to trade, but also when not to trade. Avoid trading during unfavorable times and market conditions like low volume/volatility conditions, beyond major sessions, exotic currency pairs, wider spread, etc.
Example of EUR/AUD H1 Chart
This screenshot below shows an example of COG RSI in action.
How to set up the COG RSI indicator in MT4?
Download the COG RSI.rar archive at the bottom of this post, unpack it, then copy and paste the COG RSI.ex4 or COG RSI.mq4 indicator files into the MQL4 folder of the Metatrader 4 trading platform.
You can gain access to this folder by clicking the top menu options, which goes as follows:
File > Open Data Folder > MQL4 > Indicators (paste here).
Now go to the left side of your MT4 terminal. In the Navigator find the gauge name, right-click it and select Attach to the chart.
The COG RSI indicator is well worth adding to your trading collection. A good forex indicator will most probably enhance your chance of success. Nonetheless, remember about having realistic expectations. Just like any other technical analysis tool, is not capable of providing accurate signals 100% of the time. Thus, this forex indicator provides false signals occasionally. Its performance will vary significantly depending on market conditions. Feel free to develop your own trading system based around it.
Download Free Forex MT4 COG RSI Indicator
To download the COG RSI Indicator for Metatrader 4 (MT4) for free just click the button below: