OPEN-SOURCE SCRIPT
Advantage RSI Predictor
Updated
Advantage RSI Predictor reverses the calculation of Relative Strength Index. Once the bar ends, this indicator calculates the price that needs to be reached (next bar) for RSI to move to a certain level. The indicator is plotted over price to show support and resistance zones based on RSI settings defined by user.
What do I see?
Why do I use it?
Finally, last but definitely not least, the main reason behind publishing this indicator is to prove that the RSI indicator is NOT what it is perceived to be.
RSI does not measure the velocity or magnitude of the recent move, but simply the distance between price and exponential moving average of the corresponding length.
50-point RSI Predictor(length) = Exponential moving average(2*length-1) shifted by 1 bar.
What do I see?
- upper and lower (red) lines show where the price needs to move for RSI to show predefined levels; default settings are: RSI (close,14); 70-point as overbought level (upper); 30-point as oversold level (lower)
- middle line (On/Off) calculates where the price needs to move for RSI to be 50 points
Why do I use it?
- knowing support and resistances in advance, you can use it in day trading when intraday move reaches your support or resistance
- by switching to a higher time frame, you can establish where support and resistance is in multiple time ranges
Finally, last but definitely not least, the main reason behind publishing this indicator is to prove that the RSI indicator is NOT what it is perceived to be.
RSI does not measure the velocity or magnitude of the recent move, but simply the distance between price and exponential moving average of the corresponding length.
50-point RSI Predictor(length) = Exponential moving average(2*length-1) shifted by 1 bar.
Release Notes
Fixed bug: The user can now choose {open, high, low, close, hl2, hlc3, ohlc4, hlcc4} as input for RSI calculation.Open-source script
In true TradingView spirit, the author of this script has published it open-source, so traders can understand and verify it. Cheers to the author! You may use it for free, but reuse of this code in publication is governed by House rules. You can favorite it to use it on a chart.
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Educational content: advantagetrading.net/blog.html
Scripts published by AdvantageTrading are for educational purposes only. It is not financial advice, and past performance does not guarantee future results.
Scripts published by AdvantageTrading are for educational purposes only. It is not financial advice, and past performance does not guarantee future results.
Disclaimer
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