This indicator is a modified version of the RSI indicator. It has 2 added lines into it, one upper line and one lower line. These lines are dynamic and their values will always be changing. These lines are here to replace the fixed overbought and oversold level. Once the RSI goes beyond the upper limit, it means that we are in overbought situation and when it crossed the bottom limit, it means that we are in oversold situation.
Trading this indicator should be fairly easy and you can use it to mix with other indicators and hopefully come up with a good trading system. Watching overbought and oversold levels help you in catching tops and bottoms.
My advice is not to take a trade when the RSI crossed these boundaries and take the trade only when the RSI crosses back from the boundary and re-enter the normal range. Taking trade as soon as RSI goes beyond these levels can be risky as the price can keep going in same direction without the move being reflected much on the RSI.
Nice share! I kind of remember that I created something similar to this a while back.
So its like a Stochastic Oscillator for the Relative Strength Index? (Means that it normalizes its values based on lowest and highest values)
nice system bro
nice indicator. why the RSI setting is 5, not 14 ?? Can we tweak the RSI setting?
This is an awesome indicator. Just one quesiton if I wanted to use your code in another (personal) indicator A) is that ok and B) how can I get the value of the bottom StDev?
Thanks for sharing this modified version of the RSI indicator.
thank for information....