Volume Weighted RSI PRO | Anonycryptous

The Volume Weighted RSI PRO indicator provides a multi-layered approach to momentum and liquidity analysis by weighting RSI calculations with relative volume. By scaling price changes based on institutional participation, this tool identifies high-conviction moves and filters out low-volume noise, integrating divergence detection and automated liquidity mapping directly into the charting environment.

Usage

The Usage section highlights how to interpret the volume-weighted logic and the various technical overlays provided by the indicator:

• Volume Weighted Interpretation: Unlike standard RSI, the VW RSI pushes faster toward extremes during high-volume moves and remains flatter during thin participation. Users can compare it against the included standard RSI reference line to identify where volume is distorting price movement.
• Money Flow Index (MFI) Confluence: The MFI acts as an independent momentum layer. When both the VW RSI and MFI reach overbought or oversold extremes simultaneously, it indicates a high-probability structural extreme.
• Divergence Mapping: The script automatically detects bullish and bearish divergences. When momentum weakens as price extends, the indicator draws connecting lines in the oscillator pane and a spatial box on the price chart to highlight the specific price action involved.
• Liquidity Level Interaction: Swing highs and lows are plotted as horizontal liquidity lines. These represent areas where stop orders cluster. Each level includes a volume ratio label; a level formed on high relative volume (e.g., 2.0x) is considered more significant than one formed on low volume.
• Signal Line Filtering: An EMA signal line provides crossover markers. Momentum is considered bullish when the RSI is above the signal line and bearish when below. This is often used to filter divergence setups before entry.

Details

The script's core logic revolves around multiplying each bar's price change by its relative volume (the ratio of current volume to a smoothed average) before applying the smoothing process. This ensures that the oscillator reflects the quality of participation rather than just price displacement.

The liquidity engine monitors pivots and projects them forward until they are mitigated by a price close through the level. This automation removes visual clutter while maintaining historical context. Additionally, the indicator tracks volume intensity within overbought and oversold zones, providing a label that compares the average volume during the extreme reading to the baseline average.

Settings

RSI Settings

• RSI Length: The lookback period for the VW RSI calculation.
• Volume Smoothing: The moving average period used to normalize bar volume.
• Volume Weighted Mode: Toggles between the volume-weighted calculation and standard RSI.
• Show Signal Line: Enables the EMA signal line for crossover analysis.
• Signal Line Length: The period for the signal line EMA.
• Show MFI Line: Displays the Money Flow Index for secondary momentum confirmation.
• Overbought/Oversold Level: Customizable thresholds for signal and zone triggers.

Divergence

• Sensitivity: Adjusts the pivot lookback window (High, Medium, Low).
• Divergence Box: Toggles the visualization of price ranges involved in a divergence.

Liquidity Levels

• Detail Level: Controls the frequency of liquidity line detection (Minimal, Standard, Full).
• Max Levels Each Side: Limits the number of active lines shown above and below price.

Visuals & Dashboard

• Bar Coloring: Applies a gradient to price bars based on RSI position.
• Show Dashboard: Toggles the real-time data panel containing current RSI, volume ratios, and active liquidity levels.

FAQ

What is the "Volume Ratio" in the dashboard? The volume ratio compares the current bar's volume to its recent average. A value above 1.0 indicates higher-than-average participation, while values above 1.5 are highlighted to signal significant institutional activity.

How does level mitigation work? A liquidity level is automatically removed from the chart when price closes through the line. This ensures the chart only displays active structural levels that have not yet been "swept" or neutralized.

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