InvestorQ : What are Overbought and Oversold zones and how they can be used in intraday trading effectively?
Niraj Mehta made post

What are Overbought and Oversold zones and how they can be used in intraday trading effectively?

Answer
image
Niraj Mehta answered.
3 years ago
Follow

This is about how to trade in intraday with a mix of charts and subjective judgement. When stocks have corrected sharply, how to differentiate between smart buying and catching a falling knife? Have you heard of Relative Strength Index (RSI)? It will help you to identify such zones of overbought and oversold. The answer is to use RSI indicators in charts to identify the overbought and oversold zones. For intraday trading, if other factors are also supportive, then you can buy in oversold zone and sell in overbought zone! Intraday trading is a short term trading approach and it must be treated as such. Your focus must be to manage your risk and keep churning your capital rapidly so that your ROI can be enhanced. Above all, intraday trading is about a continuous learning experience!

0 Views