PROTECTED SOURCE SCRIPT

Relative Strength Momentum

The RSI is a traders friend - it can provide insight that other indicators simply cannot. The RSI achilles heel is that it can often fail to highlight divergence. Constance Brown attempted to resolve this problem with the 'Composite index' - a powerful tool. However.. for me, looking at two indicators can get a bit much - especially if viewing multiple time-frames. I want one tool which provides the RSI, it's ranging/reversal behaviour (as documented by Andrew Cardwell) and a better grasp of momentum swings (via divergence and reversal signals). So this is my best effort, and I hope it can prove useful to some of you. At first the differences may be hard to spot - but they are there!

My default settings are optimised - as with the 'normal' RSI you can expect a bullish trend to result in few (if any) moves below 30. In a bearish trend, you can expect few (if any) incursions above 70. Cardwell's observations apply. I recommend using this with a 50 period EMA to provide some additional context.