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Home Forex MT4 Indicators RSI Divergence Indicator for MT4

RSI Divergence Indicator for MT4

The RSI Divergence Indicator for MT4 shows a divergence between price and the Relative Strength Indicator.

Divergence is a disagreement between the price action and the oscillator. You can notice this pattern when the lower lows (in a downtrend) or higher highs (in an uptrend) of the price chart differs with the peaks and troughs of the oscillating RSI indicator.

Divergences are usually used for finding and trading market trend reversals. That is very powerful price action forex strategy.

In a few simple words, during uptrend divergence between price action and RSI happens when the price of a currency pair makes higher highs but the RSI indicator does not, and alternatively, during downtrend divergence between price and RSI happens when the price of a currency pair makes lower lows but the RSI indicator does not.

The RSI Divergence MT4 Indicator is displayed in a separate trading window below the main trading chart. The red and yellow lines indicate a divergence between price and RSI.

How to trade with the RSI Divergence Indicator?

Trading signals of the RSI Divergence forex indicator are easy to follow and you can find them below.

Open BUY trade when the following conditions are met:

  • There is a downtrend.
  • The price action of your currency pair makes lower lows but the RSI divergence indicator does not.
  • The RSI Divergence Indicator draws a divergance line.
  • That is an early signal of a trend reversal. You can go long after closed candle.
  • Optionally, you can confirm the buy trade with the help of other technical tools.
  • Take profit or exit the trade at the arrival of the opposite signal.

Open SELL trade when the following conditions are met:

  • There is a uptrend.
  • The price action of your currency pair makes higher highs but the RSI divergence indicator does not.
  • The RSI Divergence Indicator draws a divergance line.
  • That is an early signal of a trend reversal. You can go short after closed candle.
  • Optionally, you can confirm the sell trade with the help of other technical tools.
  • Take profit or exit the trade at the arrival of the opposite signal.

How to install this indicator on your Metatrader trading plaftform?

  • Download the indicator by clicking “LINK” button at the bottom of this post.
  • Copy and paste the RSI Divergence indicator files into following folder of your Metatrader 4 platform: MQL4 > Indicators.
  • You can gain access to the folders this way: File > Open Data Folder > MQL4 > Indicators (paste files here).
  • Restart your Metatrader 4 Client.
  • Select Chart and Timeframe where you want to test the indicator
  • Browse “Custom Indicators” in your Navigator that is located on the left in your Metatrader 4 platform.
  • Right click on rsi-divergence-indicator.mq4 and than click “Attach to the chart”.
  • You can modify settings if you need and than click ok.
  • The indicator is ready and running on the chart.

RSI Divergence Indicator free download.

To download this MT4 indicator or trading system just click the button below:

LINK

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