Do you consider candle's wicks on the chart when you draw the line of divergence with RSI?

lucacrebbe

Active Trader
Jun 26, 2017
108
1
32
41
I have red this on line:

''the indicator ( bottom line ) move constantly during the time the candle is active, the line only stop when the candle close that's why you can't take wicks into account

look at the 1 minute chart see how the last segment of the RSI constantly move with the price during that one minute then when the candle close the line stop moving and a new segment start for the next 1 min
if the price move up then righ back down you get a wick but the RSI doesn't stay up it come back down with the price''


do you consider them or not?

and what about when you are drawing resistences and support do you consider candle's wicks or not?

chart pic

https://i.ibb.co/C6hJ5bj/Schermata-da-2020-04-19-23-14-57.png
It is the chainlink chart
 

Enivid

Administrator
Staff member
Nov 30, 2008
16,143
838
144
Odessa
www.earnforex.com
By default (as many other indicators), RSI is calculated using candles' Close prices. But it can be set to calculate using any other price. For example, here how it can be changed in MetaTrader 4:
rsi.png
Of course, if you set it to calculate on Close, and you want to look for divergences with the actual price chart, it is only logical to compare it to candles' Close prices. I would even suggest switching to a plain Line chart (plotted using Close) to seek for divergences.

On the other hand, Close by itself has little weight in real trading (unless it is a daily close in stocks or weekly close in FX). After all, it is just a pretty random point in time and thus price. So, when drawing support and resistance lines I rely more heavily on wicks (High/Low) than on Close.