New Fail-Safe Trade Indicator by jaggu

About:
Fail Safe indicators are made from stolid Moving Averages,which are more reliable than other lagging and leading indicators,since they follow market trend.

this 3 step simple & easy to use indicator is proven with tried and tested in various bull and bear markets with excellent results comparable to almost positional trade fail safe by jaggu.

Features:
Name fail safe comes from fact that,this indicator has to be updated daily and manually,free from any technical problem..so there is less chance of failing/or giving wrong trend.

this indicator is used as Reliable End of Day (EOD) indicator, since it depends basically on Open-High-Low-Close values.

this indicator is used for positional trade in trending market,in addition with intraday trades (with separate real time file for intraday trading also available)

How to use this Excel Sheet indicator:

 

In this,there are 3 separate indicators:

SL = this one gives the stoploss for your long or short position,

Day/Intraday trend= this indicator tells which is the best position for intraday trading

Positional trend= this indicator tells u whether the market is in down trend or uptrend.

Example Of Nifty (NSE 50) from 2008 onwards till dec 16-2010

Relative Strength Index (RSI):Meaning &Calculation

Introduction
Developed by J. Welles Wilder and introduced in his 1978 book, New Concepts in Technical Trading Systems, the Relative Strength Index (RSI) is an extremely useful and popular momentum oscillator.

The RSI compares the magnitude of a stock's recent gains to the magnitude of its recent losses and turns that information into a number that ranges from 0 to 100. Like most indicators, the RSI only needs one stock to be computed.

Calculation
n = number of days
Average gain = (total gains/n)/(total losses/n)
For First RS = (Aver.Gain/Aver Loss)
RSI=100-(100/1+RS)

Interpretation
Overbought/Oversold
If the RSI rises above 30 it is considered bullish for the underlying stock.
If the RSI falls below 70, it is a bearish signal.

Trading Signals & Divergences
Buy and sell signals can also be generated by looking for positive and negative divergences between the RSI and the underlying stock.

Positive divergence
Buy when price and the Relative Strength Index are both rising.
Sell when the price and the RSI are both falling.

Negative divergence
Buy when price falls and but RSI does not fall instead goes up.
Sell when the price goes up and but RSI does not go up instead falls by good margin

The underlying stock will often reverse its direction soon after such a divergence.

To Calculate Formula in Excel For RSI
Column,Description, = Formula To Enter,Cell No. to Enter
A=Date
B=Open/Previous Close
C=High
D=Low
E=Close
F=Volumes

To compute Gain/Loss:
G = % Change, =E3-E2, In G3 & AutoFill (Copy)( Press Shift +D on Kybrd)

To compute Gain only:
H= Advance, =IF(G3>0,G3,0) ,In H3 & AutoFill (Copy)( Press Shift +D on Kybrd)

To compute Loss only:
I= Decline, =IF(G3<0,G3,0) ,In I3 & AutoFill (Copy)( Press Shift +D on Kybrd)

To compute Average Gain:
J=Average Losses,=AVERAGE(H3:H16),In J16 & AutoFill (Copy)( Press Shift +D on Kybrd)

To compute Average Loss:
K=Average Losses,=AVERAGE(I3:I16),In K16 & AutoFill (Copy)( Press Shift +D on Kybrd)

L=For First RS,= (Aver.Gain/Aver Loss)
L=RS,=ABS(J16/K16),In L16 & AutoFill (Copy)( Press Shift +D on Kybrd)

M=RSI(14 day),=100-(100/1+RS)
M=RSI,=IF(K16=0,100,100-(100/(1+L16))),In M16 & AutoFill (Copy)( Press Shift +D on Kybrd)