RSI VWAP POC

The RSI VWAP POC indicator is a multi-dimensional oscillator that integrates the Relative Strength Index (RSI), Volume-Weighted Average Price (VWAP), and Point of Control (POC) from market profile analysis into a single interface. It aims to provide high-probability signals by identifying where price momentum intersects with significant volume-based support and resistance levels.

Usage

The indicator can be used to identify trend reversals and high-probability entries based on the interaction between the RSI line and the Market Profile data.

• Bullish Signals: A "Strong Buy" (SBU) signal is generated when the RSI line crosses above the POC line while in an oversold zone.
• Bearish Signals: A "Strong Sell" (SBD) signal is generated when the RSI line crosses below the POC line while in an overbought zone.
• Market Profile Interpretation: The aqua-colored bars represent the Value Area, where the majority of volume was traded during the lookback period. The red line represents the POC, indicating the highest volume concentration.
• Trend Confirmation: The background colors (green for bullish, red for bearish) provide a visual filter for the current trend based on the higher timeframe oscillator smoothing.

Details

This tool uses a unique implementation of the RSI by calculating it based on VWAP rather than standard price data. This ensures that the momentum oscillator is sensitive to volume distributions. Furthermore, the indicator calculates a Market Profile (POC and Value Area) based on the RSI values over a user-defined higher timeframe. This allows traders to see "volume at RSI level," identifying which momentum zones have historically attracted the most trading activity.

Settings

Oscillator Settings

• RSI Length: Determines the lookback period for the RSI calculation.
• EMA Smoothing Length: Sets the smoothing factor for the primary RSI line to reduce market noise.
• Oscillator Timeframe: Sets the timeframe for the secondary trend confirmation oscillator.

Market Profile Settings

• Higher Timeframe: Defines the period used to calculate the Market Profile and POC.
• Value Area (%): Adjusts the percentage of volume used to define the Value Area (default is 100% for full distribution).
• Show POC Line: Toggles the visibility of the red Point of Control line.
• Keep Old Market Profiles: If enabled, historical profiles remain on the chart; otherwise, only the most recent profile is shown.

Visuals & Signals

• Show Breakup/Breakdown Signals: Toggles standard RSI/POC crossover labels.
• Show Strong Breakup/Breakdown Signals: Toggles labels for crossovers specifically occurring in overbought or oversold territory.
• Thresholds: Customizable levels for Overbought (70/60) and Oversold (30/40) zones.

FAQ

How do I access the RSI VWAP POC?

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

Which timeframes are best for this indicator?

While suitable for all timeframes, it is optimized for a 1-hour chart using a 4-hour (240 min) higher timeframe setting for the profile calculation.

What does the red line in the oscillator panel represent?

The red line represents the Point of Control (POC), which is the RSI level where the highest amount of volume activity has occurred within the selected higher timeframe.