Next-gen buy-sell signals
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RSI Power Signal V3
Premium Version
This indicator combines multiple RSI signals to find stress points and consequently a shift in trend strength and momentum. The signals are processed and then intuitively presented with clearly defined actionable outputs
Description
This trading indicator combines multiple RSI calculations with price levels to detect market trends, consolidations, and divergences. By using the combination of these techniques, it attempts to provide more nuanced and accurate trading signals. The visualization aspects such as background coloring and line styling enhance the usability and interpretation of the indicator on a trading chart.
How can the indicator be used?
Identify trends
Asses Overbought/Oversold levels
Spot divergences
Fine-tune entries and exits
Juan Jacobs
Developer
(FX Automate)
With a BSc in Business Information Technology, Juan traded a 7-year career as a Systems Analyst for full-time trading. Through logic and methodology, Juan's created numerous successful trading systems and indicators. His contributions to ProRealTime are a testament to his expertise, making him a respected figure in the community.
Release date
Nov 2020
Market
Which ever
Full description
Providing nuanced insights into market behaviour
This trading indicator is a multifaceted tool designed to provide nuanced insights into market behavior by combining multiple RSI calculations with other technical concepts. At its core, it employs five different RSI calculations based on varying periods to create a more comprehensive picture of market momentum. These RSI calculations are used in the detection of divergences, which are key reversal signals in trading. By calculating an average of these RSI values and further smoothing it with a zero-lag exponential moving average, the indicator introduces a sophisticated mechanism to identify divergence ranges.
Furthermore, the indicator includes a consolidation detection system that examines the range of prices and RSI values within a specific range. This enables traders to identify periods where the market is moving sideways and may be preparing for a breakout. A color-coding system is used throughout the code to symbolize different market conditions, making it visually intuitive for traders to recognize market trends.
The system also includes provisions for detecting bullish and bearish trends based on comparisons of RSI values across different timeframes. The trend detection is enhanced by implementing conditions to identify potential take profit signals and trend reversals. Color changes in the background serve to emphasize these key transitions, providing visual cues that are immediately recognizable on a trading chart.
How to interpret signals
The 3 Indicator components
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The Zero-Lag RSI Trend Line (Color coded to help indicate current price action and trend)
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Divergence Signals in the top and bottom margins
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Action Bars (Color coded – see explanation for each color below)
Possible Interpretations of Price Action Signals
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Dark Green = Early Buy Signal
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Dark Red = Early Sell Signal
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Light Green = Buy Confirmation Signal (Consider Long Entry) / Exit Shorts
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Pink = Sell Confirmation Signal (Consider Short Entry) / Exit Longs
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Grey = Entry Invalidated, consider exit or use a tight trailing stop loss
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Dark Blue = Bullish momentum fading pullback/consolidation imminent
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Magenta = Bearish momentum fading pullback/consolidation imminent
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Green Dotted Area = Bullish consolidation (market could push higher)
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Red Dotted Area = Bearish consolidation (market could push lower)
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