RSI Chart Levels

The RSI Chart Levels indicator identifies and projects key pivot levels from the Relative Strength Index (RSI) directly onto the price chart to highlight potential support and resistance zones. This tool simplifies the process of identifying market structure shifts and divergence by visualizing RSI peaks and troughs as horizontal levels and zones on the main chart.

Usage

The RSI Chart Levels tool is designed to help traders identify significant price levels derived from oscillator momentum. When the RSI forms a pivot (a high or low), the indicator marks that price point with a label and extends a horizontal line and a colored zone.

• Support & Resistance: The horizontal lines act as dynamic support and resistance. If price interacts with a level established by an RSI extreme, it may indicate a potential reversal or breakout point.
• Spotting Divergence: By comparing price action to the labeled RSI pivots (Higher Highs, Lower Highs, Higher Lows, Lower Lows), traders can identify divergences in real-time. For example, if the price makes a new Higher High but the indicator labels the RSI pivot as a Lower High, a bearish divergence is present.
• Zone Interpretation: The indicator draws boxes (zones) at pivot points. The color of these zones changes dynamically based on whether the current price is above or below the midpoint of the zone, assisting in bias determination.

Details

The script functions by calculating a standard RSI and then applying a Zigzag-style pivot detection algorithm to the RSI values. When a pivot high or low is confirmed on the RSI (based on the "Zigzag Length" setting), the script retrieves the corresponding price at that specific bar and projects it forward.

This implementation is inspired by the concepts of RSI divergence scanning, refactoring the logic to focus on chart-based overlays. It uses the ta.pivothigh and ta.pivotlow functions on the RSI stream to ensure that only significant momentum turns are translated into price levels.

Settings

Inputs

• Show Trend Lines: Toggles the visibility of the horizontal lines and labels on the chart.
• Zone Type: Determines the vertical range of the drawn boxes. "High-Low" uses the candle's wick range, while "High-Close" uses the wick and the body.

RSI

• RSI Length: The lookback period used for the internal Relative Strength Index calculation.
• RSI Source: The price source used to calculate the RSI (default is close).

Trend Line

• Zigzag Length: The number of bars required on each side of a point to confirm a pivot. Increasing this value will result in fewer, more significant levels, while decreasing it will show more frequent, shorter-term levels.

FAQ

How do I use RSI Chart Levels to find divergence?

You can spot divergence by comparing the labels (e.g., "Higher High") with the actual price movement. If the price makes a new high but the indicator displays a "Lower High" label, it suggests momentum is slowing down.

Should I match these settings with my RSI oscillator?

Yes, for the most accurate interpretation, it is recommended to match the "RSI Length" and "RSI Source" of this indicator with any RSI oscillator you have loaded on your sub-pane.

How can I access this tool?

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