The RSIDivergence for Pair Trading

The RSIDivergence is a custom indicator for the MetaTrader 4 (MT4) platform, designed to analyze the divergence between the Relative Strength Index (RSI) values of two currency pairs. It compares the RSI of the chart’s symbol (first symbol) with a user-defined second symbol, displaying both RSI values and their absolute difference (divergence) in a separate subwindow. The indicator provides visual and alert-based feedback to highlight significant divergence levels, with customizable settings for flexibility.

Key Features

  1. RSI Calculation:
    • Computes RSI for the chart’s symbol (e.g., EURUSD) and a user-defined second symbol (default: USDCHF) using a configurable period (default: 8).
    • Supports inversion of RSI values for either symbol (default: disabled), allowing users to reverse the RSI calculation (100 - RSI) for specific analysis needs.
  2. Divergence Measurement:
    • Calculates the absolute difference between the RSI values of the two symbols, plotted as a dotted line in the subwindow.
    • Displays the current divergence percentage in a label within the subwindow, updated in real-time.
  3. Visualization:
    • Plots RSI for the first symbol (default color: aqua) and second symbol (default color: red) as solid lines in a subwindow, scaled from 0 to 100.
    • Shows divergence as a dotted line (default color: yellow) in the same subwindow.
    • Includes RSI levels at 10, 30, 70, and 90 for reference, with a customizable label for divergence display (position, font size, and color adjustable).
  4. Alerts and Notifications:
    • Triggers alerts when divergence exceeds a user-defined threshold (default: 80%), with options for pop-up alerts (default: enabled) and push notifications (default: disabled).
    • Prevents repeated alerts on the same bar using timestamp tracking, ensuring one alert per bar.
    • Alert messages include the symbols, divergence percentage, threshold, and timestamp.
  5. Customization:
    • Offers input parameters to adjust the second symbol, RSI period, inversion settings, colors (for RSI lines, divergence line, and label), label position (X, Y coordinates), font size, and alert settings.
    • Allows users to enable/disable alerts and notifications based on their preferences.

Usage

  • Initialization: Validates the second symbol in Market Watch, accounting for any suffix (e.g., ".m" or ".pro"). Sets up three buffers for RSI and divergence, creates a divergence label, and configures the subwindow with a custom name.
  • Operation: Calculates RSI for both symbols and their divergence for each bar, updating the subwindow plots and divergence label. Checks for divergence exceeding the threshold and triggers alerts if enabled.
  • Visualization: Displays RSI lines, divergence line, and a label showing the current divergence percentage in the subwindow, with customizable colors and positions.
  • Deinitialization: Removes all indicator objects (labels) from the subwindow upon removal.

Notes

  • Requires the second symbol to be available in Market Watch, with automatic suffix detection for compatibility.
  • Operates on the current chart’s timeframe, processing bars efficiently based on the RSI period.
  • The indicator focuses solely on RSI divergence, without additional technical indicators or risk management features.

 


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