RedK Vol_Weighted RSI: Extending the power of the classic RSI

Let's take the classic Relative Strength Index ( RSI ) and give it couple of modern upgrades - the results are better visuals with improved signals and trade decision support:

Options and features:
- Dual period: look at the short term RSI vs a backdrop of a longer period RSI (expressing the longer-term "prevailing sentiment") - get clearer "re-entry" points in long bull or bear runs
- Longer period RSI has a "Step" option - since what we won't be really interested in the fractions, but more of the broad "strength" of the sentiment (weak, medium..) - default set to a step of 5. please experiment with what works best for you.
- Option to make the RSI volume-weighted. (On by default) - won't say much here, but possibly this is the biggest and most important added feature for those keen on the combined price - volume effect (and Wyckoff'ians)
- Smoothing option -- i would keep this set to 3 to avoid extra lag due to the smoothing
- scaled to +100 / -100 with zero as the signal line - that's how i like oscillators to work
- Adjustable optional overbought / oversold levels - can also be used to also mark strong up/down levels
- designed for the "visually oriented" -- like me :)
- code is open and commented

What Values to use:
many setting combinations possible. play around and find your sweet spot based on what/how you trade. for me, i usually prefer what i set as defaults in the study.
tip: if you set Length = 14, smoothing = 1, Sent. factor =1, Vol Weighted = No, you're back (almost) with a classic RSI - the only difference would be that i use Weighted Moving Average in my calculation of the RSI (i tend to believe WMA is the most naturally-suited for looking at "market price" data series)

Please feel free to use, share or give feedback.
Jan 29
Catatan Pelepasan: - added an up/down signal for when the RSI line changes color (i.e, direction). Note that the signal will be shifted by -1 bar, and will plot after the bar closes if it's triggered
Keluarkan daripada Skrip Pilihan Tambah kepada Skrip Pilihan


Great indicator, I'm using here in Brazil with mini indice,(IBOV) and it's working wonderfull! Thanks for sharing with us . For that particular mini indice I'm using different configuration, is 14-3-4-5 and without sentiment. It's more clean and easy to understand (for me). I'd like to show the print of my screen, but I dont know how, I'm new here with TradingView.
+1 Balas
RedKTrader JohnnyMarques
@JohnnyMarques, thank you.. good luck!
JohnnyMarques RedKTrader
@RedKTrader, Ok my friend.

I thought twice and started to do tests with the sentiment, because it has indicated strong or false entries in my last studies that I did today. thanks
Hello Redktrader I see that the indicator repaint the arrows can you modify the code so it doesn't re paint? Best.
RedKTrader Jayosilia
@Jayosilia, thanks for the comment - i mentioned that it does that in the description as the signal is shifted by -1 bar. if this is not working for you, you can remove the ", offset = -1 " from the 2 signal lines in the code (lines 42 and 45 above) - then the signal will show after the bar that gets it triggered - hope this helps
Wow, This is extraordinary. Nice setup for trading stocks and portfolio building /trimming. Thanks for sharing your work. Best Regards.
RedKTrader AnnaCrude
@AnnaCrude, thank you for your comment - please feel free to share more about how you're using this in your trading and if it's helping - that would be rewarding :)
AnnaCrude RedKTrader
@RedKTrader, Picks up rebounds nicely.

Very much useful for portfolio investors like me.
If I am not disturbing you, can you post the strategy performance inbuilt code?
The strategy will enable me to work out brokerage costs, taxes including income tax and cost of financing.

All along been I was looking for this indicator, My search stops with this indicator.
My only disappointment is, it doesn't work with Indices. Plz, check.

RedKTrader AnnaCrude
@AnnaCrude, picking up rebounds: that's true - when sentiment is bullish, you can find good entry spots when the fast RSI is negative and reversing up. there are 3 examples of that in your first chart.
also, i find it showing better diversion with price vs the classic RSI - possibly due to being volume weighted. there are 4 examples of diversion with price in your second chart.
i don;t have a strategy developed for this - sorry - i need to educate myself in that area which i have not yet explored in TV
can you describe where it fails with indices ? did you try to uncheck the "Volume-weighted" option when on an index chart and see if that works.
AnnaCrude RedKTrader

Thanks for your guidance. It works after unchecking. Best Regards.

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