RSI Vs MACD Question

[Catterpie90]

Hello everyone,

I read somewhere that MACD is best used in a trending stock (uptrend or downtrend) while RSI is best used in a consolidating stock (trading sideways). Is this true or not?

Here are some of my thoughts,
1) RSI is basically useless in a trending stock because it would hit oversold (70 lvl) when the stock would actually go higher

2) MACD is bad in a consolidating stock because it utilizes MA, and when in a flat chart the MA are also not moving alot.

Your thoughts on these are highly appreciated.

Thanks in advance :cheesy:

 

[bootsyjam]

Both are oscillators which monitor previous price movement. As such they have no relation to the current price and how it will move. So they are useless.

I would ditch looking at oscillators and lagging indicators and start delving into auction market theory and the importance of velocity and volume whilst studying how to use the related volume profile tool. Note that this is used in futures markets where there is recordable volume and not in fx markets. Also, note that futures fx markets have quite light volumes when compared to spot fx which is conducted across numerous liquidity pools/markets across the globe.

I speak as someone who tried to outsource my decision making to oscillators for years and understand how attractive they can be.

 

[bootsyjam]

Ditch them!

Both are oscillators which monitor previous price movement. As such they have no relation to the current price and how it will move. So they are useless.

I would ditch looking at oscillators and lagging indicators and start delving into auction market theory and the importance of velocity and volume whilst studying how to use the related volume profile tool. Note that this is used in futures markets where there is recordable volume and not in fx markets. Also, note that futures fx markets have quite light volumes when compared to spot fx which is conducted across numerous liquidity pools/markets across the globe.

I speak as someone who tried to outsource my decision making to oscillators for years and understand how attractive they can be

 

[bootsyjam]

I tried to edit my original message. Go to futures.io it has a lot of great free resources/videos etc