The Reverse Relative Strength Index was created by Giorgos Siligardos (Stocks & Commodities V. 21:6 (18-30)). It is a handy indicator that reverse engineers the RSI price calculation to show what the price would have to be for the RSI value to match our chosen input. You can select your chosen RSI level using the RSI Level input for this indicator. For example if you wanted to see what the price would be for the RSI value to match the oversold level then you would set the RSI Level for 30 and it will plot that price on the chart. This uses some simple math to extrapolate the price with some basic algebra from the typical RSI calculation. This, of course, is a very similar concept to my previous Reverse Moving Average Convergence Divergence script. This indicator formula can be used for any oscillator with some slight tweaking and could also be customized to show the price for overbought and oversold levels, which I will probably do in the near future. This indicator is useful in many ways such as a trend indicator as my example shows or for a price projection tool. For example, if you had a current RSI level of 66 and it was going up and you want to see what the price would be if it reached the overbought level then you could do that. Let me know what works well for you and if you have any suggestions for how to further improve upon this script. I have included darker colors to show stronger signals and lighter colors to show normal signals. Buy when the line turns green and sell when it turns red.
I have a bunch of backlogged scripts that I'm trying to publish, so I figured I would focus on my RSI scripts since I have a bunch, so be prepared to see a bunch of those over the next week or so. Let me know if there are any other scripts you would like to see me publish!
Informacje o Wersji
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Fixed a error with the math
Informacje o Wersji
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Fixed issue with incorrect ticker sometimes being used
Hi there. you say, "It is a handy indicator that reverse engineers the RSI price calculation to show what the price would have to be to have a matching level.". Im confused by this...to have a "matching level" of what exactly? Can you reword or elaborate slightly so the dumber of the community can grasp at 2nd glance? Id really appreciate it.
cheatcountry
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@chasinalts, Sorry about this. I will try to amend the description to be more thorough. So, for example, if you wanted to see what the price would be at a particular bar for the RSI value to be at the oversold level then this indicator will show you what the price would have to be on that bar for the RSI value to be at that exact oversold level amount. I hope this clears it up and if not then I will elaborate further.
A_Traders_Edge
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@cheatcountry, and the level you're referring to is according to the input level "rsiLevel" of which you have as 50 as default? If so then I see. This is banging. Thanks a lot for the quick response. Last question, Ive seen other publications talking about "reverse engineering" indicators/calculations. What does this mean exactly? Ive often wondered what users mean when they say this. What would I search on google to learn how to reverse engineer other indicators/calculations (as you've said you've done with MACD as well)?
cheatcountry
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@chasinalts, I will do a better job of explaining once I'm able to update the description but one of the best use cases for these types of indicators would be price projections. Say for example the RSI level is below the midline but rising, this indicator could give you the estimated price it would hit once it reaches the midline. I hope that clears things up better for you.
A_Traders_Edge
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@cheatcountry, Perfectly, Thanks again. You really do great work on here. Keep it up.
This is excellent. as per your note... I see this being expanded to several popular indicators... allowing the user to change between them. Then a table on the graph listing them with a range of price action points.