Impulse RSI - TobbySimard

The Impulse RSI indicator combines momentum and Relative Strength Index (RSI) mathematics to provide a smoother, context-aware measure of trend strength and directional conviction. By applying RSI calculations directly to price momentum rather than raw price, the tool identifies shifts in trend velocity and filters out market noise more effectively than traditional oscillators.

Usage

The Usage section describes how the script can be used to identify market bias and entry opportunities. The indicator oscillates between 0 and 100, centered around a 50-level axis.

• Directional Bias: When the signal line is above 50, the market is considered bullish; when below 50, it is bearish. A "Threshold Buffer" can be applied to create a neutral zone around the 50 level to reduce whipsaws in sideways markets.
• Zone Identification: The oscillator panel is divided into four colored zones representing different momentum intensities:
  • Zone 1 (30–40 - Red): Deteriorating or weak bearish momentum.
  • Zone 2 (40–50 - Blue): Bearish side showing signs of hesitation or recovery.
  • Zone 3 (50–60 - Green): Bullish side with moderate strength.
  • Zone 4 (60–70 - Orange): Elevated bullish momentum and high conviction.
• Entry Confirmation: Users can enable "Show Signal Rising" to highlight specific long entry windows. This occurs when the signal is above 50 and actively climbing compared to its position N bars ago (Signal Lookback).
• Bar Coloring: When enabled, price chart candles are colored according to the indicator’s current zone, providing visual trend context without needing to reference the oscillator panel constantly.

Details

The Impulse RSI is constructed through a three-stage calculation process. First, it measures raw momentum by calculating the difference between the current price and the price from a specified lookback period (Momentum Length). Second, it calculates the change in this momentum (acceleration) from bar to bar. Third, Wilder’s Smoothing (RMA) is applied to the gains and losses of that acceleration, similar to a standard RSI formula.

Unlike a standard RSI that measures the magnitude of price changes, this indicator measures the magnitude of momentum changes. The final output is smoothed using an Exponential Moving Average (EMA) to produce the signal line.

Settings

Core Settings

• Source: The price data used for the calculation (default is Close).
• Momentum Length: The period used to calculate raw price momentum.
• RSI Length: The smoothing period for the RSI calculation applied to momentum changes.
• Smoothing Length: The EMA period applied to the momentum RSI to create the final signal line.
• Threshold Buffer: Defines a neutral range around the 50 level (e.g., a value of 5 creates a 45–55 neutral zone).

Rising Signal

• Signal Lookback: The number of bars to look back when confirming the signal is rising for entry highlights.
• Signal Rising Color: The color used for the chart background when a long entry condition is met.
• Show Signal Rising: Toggles the background highlighting for entries.

Visuals & Tables

• Color Bars by Zone: Enables or disables candle coloring based on the momentum zone.
• Zone Colors: Allows customization of colors for each of the four zones and the neutral area.
• Show Table: Toggles the dashboard display containing market condition, signal value, and current zone.
• Position: Controls where the dashboard table is placed on the chart.

FAQ

How do I interpret the 50 line?
The 50 line is the central pivot; values above indicate a bullish momentum bias, while values below indicate a bearish momentum bias.

What is the difference between this and a standard RSI?
A standard RSI looks at price change, whereas the Impulse RSI looks at the rate of change in momentum, making it more sensitive to trend acceleration and deceleration.

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