Simulation of technical indicators for better profits in the indian stock market

Abstract

This article designs models and uses simulation to examine optimization of technical indicators in stock market: the Moving Average Convergence Divergence (MACD) and the Relative Strength Index (RSI). Based on sector-wise Nifty 50 group of companies’ daily closing price of the stocks from the year January 2013 to September 2018. This study is to demonstrate how the simulation of technical indicators MACD and RSI helps investor in reducing the trading cycles of investment with better profits in the long run. Results concluded that the experimentation of optimization of technical indicators is one-step forward in making profitable trades as it is evident from the nifty50 stocks. Furthermore, it also proves that both the optimized MACD and RSI outperformed the standard MACD, standard RSI and Buy & Hold strategy.