Advance RSI Indicator

The Advance RSI Indicator tool identifies high-probability entry and exit points by combining Relative Strength Index (RSI) extreme levels with specific price action candlestick patterns.

Usage

The indicator generates signals when the RSI enters an overbought or oversold zone and confirms the momentum shift with a candlestick formation. Users can toggle different pattern types to suit their trading style.

• Engulfing Patterns: Triggers a "Buy" signal when a Bullish Engulfing occurs in the RSI oversold zone, or an "Exit" signal when a Bearish Engulfing occurs in the overbought zone.
• Hammer & Shooting Star: Identifies "HMR" (Hammer) labels for potential reversals at oversold levels and "SS" (Shooting Star) labels for potential reversals at overbought levels.
• Two Bar Confirmation: Triggers "2Bull" or "2Bear" signals when two consecutive candles of the same direction appear while the RSI is in an extreme zone.

Details

The script uses a standard RSI calculation but adds a layer of confirmation to reduce the "noise" often found in basic overbought/oversold systems. By waiting for price action to confirm the RSI level, the indicator aims to capture the start of a reversal rather than simply identifying a stretched price. The Hammer/Shooting Star detection is refined using a "Hammer Body Size" filter, which uses a Fibonacci-based calculation to ensure the candle wick is significantly longer than the body.

Settings

• RSI Length: The lookback period for the RSI calculation (Default is 7).
• RSI Overbought: The upper threshold level for bearish signal qualification (Default is 70).
• RSI Oversold: The lower threshold level for bullish signal qualification (Default is 30).
• Hammer Body Size: Determines the sensitivity of hammer and shooting star detection based on the wick-to-body ratio.
• Bullish Bearish Engulfing: Enables or disables signals based on engulfing patterns.
• Hammer Shooting Bar: Enables or disables signals based on Hammer and Shooting Star candles.
• Two Bull Bear Bar: Enables or disables signals requiring two consecutive bullish or bearish candles.

FAQ

How do I use the Advance RSI Indicator? Enable the desired candlestick patterns in the settings. Look for "Buy" or "HMR" labels at the bottom of price action for long opportunities, and "Exit" or "SS" labels at the top for short or exit opportunities.

Can I use multiple patterns at once? Yes, you can enable any combination of the three pattern types (Engulfing, Hammer/Shooting Star, or Two Bar) simultaneously to see all qualifying signals on the chart.

How can I access the Advance RSI Indicator? You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.