[RS][JR]RSI Price Bands

The [RS][JR]RSI Price Bands indicator projects the Relative Strength Index directly onto the price chart, transforming a traditional oscillator into a dynamic volatility band system for easier trend and reversal identification.

Usage

The Usage section focuses on how the projected RSI lines interact with the price-based bands. Users can monitor up to three different RSI periods (Fast, Medium, and Slow) simultaneously on the chart.

• Overbought/Oversold Detection: The indicator plots specific bands representing extreme RSI levels. When an RSI line enters the upper red-shaded area, the asset is considered overbought. Conversely, when an RSI line enters the lower green-shaded area, the asset is considered oversold.
• Trend Direction: The relationship between the price and the "Middle Line" (representing the RSI 50 level) helps traders identify the current momentum bias.
• Crossovers: Traders can look for crossovers between the different RSI lengths (e.g., Fast RSI crossing Slow RSI) or crossovers of the RSI lines with the OB/OS threshold lines to identify potential entry or exit points.

Details

This tool calculates the RSI Price Bands by mapping RSI values to a price-based coordinate system. It uses a base Moving Average (EMA of the high/low average) and a cumulative standard deviation ("capdev") to scale the RSI fluctuations. This allows the indicator to expand and contract based on historical volatility, ensuring the RSI lines remain relevant to the current price action rather than being stuck in a separate sub-pane.

Settings

• Source Series to be Used: Determines the price data used for all calculations (default is HLC3).
• Show RSI Line 1/2/3: Toggles the visibility of the three independent RSI projections.
• Bands Smoothness Period Length: Adjusts the period for the base moving average that anchors the bands.
• Fast/Medium/Slow RSI Period Length: Sets the lookback period for the respective RSI calculations.
• Fast/Medium/Slow Smoothness Length: Applies an EMA to the resulting RSI lines for additional smoothing.
• Bands Tightness Period Length: Controls the lookback for the deviation calculation, affecting how tightly the bands follow price.
• Show Over Bought/Sold Bands: Toggles the background highlights for extreme levels.
• OB/OS Distance: Defines the threshold for the overbought and oversold lines relative to the middle line.

FAQ

How do I interpret the colored zones? The red shaded zone represents the overbought region (near RSI 100), while the green shaded zone represents the oversold region (near RSI 0).

Can I use this for scalping? Yes, by adjusting the "Fast RSI Period Length" and "Bands Tightness," traders can tune the indicator to be more responsive to short-term price fluctuations.

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