RSI-TC_NEW_v2

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RSI-TC_NEW_v2

This script is a sophisticated technical analysis tool designed to help traders identify momentum shifts and potential breakout opportunities by combining three distinct market indicators into a single visual display.

Core Component Overview

1. Two-Tone RSI (Relative Strength Index) The primary visual element is a modified version of the RSI, which measures the speed and change of price movements. Unlike a standard RSI, this script utilizes a "Two-tone" logic. It categorizes momentum into specific behaviors:

  • It tracks whether the market is trending in a bullish or bearish direction based on predefined thresholds.
  • The indicator changes its visual output depending on these conditions, allowing traders to distinguish between different types of price pressure more clearly than a standard single-line RSI would allow.

2. The "Squeeze" Mechanism To identify periods of low volatility—often referred to as a "squeeze"—the script compares two different types of moving bands:

  • Bollinger Bands: These measure historical volatility.
  • Keltner Channels: These use an Average True Range (ATR) calculation to measure current price range. When these two sets of bands tighten and nest inside one another, the script identifies a "Squeeze." This indicates that market energy is building up and a significant breakout in either direction may be imminent.

3. Breakout Signal Logic The script generates specific "Buy" and "Sell" signals by looking for a confluence of three conditions:

  • Volatility Release: It detects when the market price escapes the "Squeeze" state (the bands begin to expand).
  • Momentum Confirmation: It checks if the RSI is positioned above or below the 50-level midpoint to determine the strength of the move.
  • Trend Continuity: It includes logic to confirm that a new signal is actually occurring by comparing current price action against the previous bar, ensuring that signals are not repeated unnecessarily during a long trend.

User Experience and Alerts

The tool provides immediate visual feedback through different colors and symbols (arrows) on the chart:

  • Visual Cues: It marks specific entry points with arrows when the breakout conditions are met.
  • Automated Notifications: If the alert feature is enabled, the script will trigger a real-time pop-up notification on your platform the moment a new Buy or Sell signal is generated. This ensures that you do not have to watch the charts constantly to catch high-probability momentum shifts.

In summary, this tool acts as a filter, taking complex data (volatility, momentum, and price action) and distilling it into clear visual signals that highlight when "quiet" markets are about to "explode" in a specific direction.

Indicators Used
Relative strength indexMoving average indicatorBollinger bands indicatorIndicator of the average true range
Miscellaneous
Implements a curve of type %1It issuies visual alerts to the screen
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RSI-TC_NEW_v2 
//+------------------------------------------------------------------+
//|                 RSI with Trend Catcher signal                    |
//|                 Copyright © 1999-2007, MetaQuotes Software Corp. |
//|                                         http://www.metaquotes.ru |
//+------------------------------------------------------------------+
#property indicator_separate_window
#property indicator_buffers 5
//----
#property indicator_color1 Lime
#property indicator_color2 Red
#property indicator_color3 Lime
#property indicator_color4 Red
#property indicator_color5 Gold
//----
#property indicator_level1 60
#property indicator_level2 50
#property indicator_level3 40
//----
int       BBPrd=20;
double    BBDev=2.0;
int       SBPrd=13;
int       SBATRPrd=21;
double    SBFactor=2;
int       SBShift=1;
extern int       RSIPeriod=21;
extern int       BullLevel=50;
extern int       BearLevel=50;
extern bool      AlertOn=true;
//----
double RSI[];
double DnRSI[];
double Buy[];
double Sell[];
double Squeeze[];
//+------------------------------------------------------------------+
//|                                                                  |
//+------------------------------------------------------------------+
int init()
  {
   IndicatorBuffers(5);
   SetIndexStyle(0,DRAW_LINE);
   SetIndexBuffer(0,RSI);
   SetIndexStyle(1,DRAW_LINE);
   SetIndexBuffer(1,DnRSI);
   SetIndexStyle(2,DRAW_ARROW,STYLE_SOLID);
   SetIndexArrow(2,159);
   SetIndexBuffer(2,Buy);
   SetIndexStyle(3,DRAW_ARROW,STYLE_SOLID);
   SetIndexArrow(3,159);
   SetIndexBuffer(3,Sell);
   SetIndexStyle(4,DRAW_ARROW,STYLE_SOLID);
   SetIndexArrow(4,159);
   SetIndexBuffer(4,Squeeze);
   IndicatorShortName("RSI("+RSIPeriod+")");
   IndicatorDigits(2);
//----
   return(0);
  }
//+------------------------------------------------------------------+
//|                                                                  |
//+------------------------------------------------------------------+
int start()
  {
   int counted_bars=IndicatorCounted();
   int shift,limit,ob,os;
   double BBMA, SBMA, TopBBand, BotBBand, TopBBandPrev, BotBBandPrev, TopSBand, BotSBand;
   bool dn=false;
   double BuyNow, BuyPrevious, SellNow, SellPrevious;
   static datetime prevtime=0;
   if (counted_bars<0) return(-1);
   if (counted_bars>0) counted_bars--;
   limit=Bars-31;
   if(counted_bars>=31) limit=Bars-counted_bars-1;
   for(shift=limit;shift>=0;shift--)
     {
      RSI[shift]=iRSI(NULL,0,RSIPeriod,PRICE_CLOSE,shift);
      ob=indicator_level1;
      os=indicator_level3;
      // ========= Two-tone RSI
      if (dn==true)
        {
         if (RSI[shift]>BullLevel)
           {
            dn=false;
            DnRSI[shift]=EMPTY_VALUE;
           }
         else
           {
            dn=true;
            DnRSI[shift]=RSI[shift];
           }
        }
      else
        {
         if (RSI[shift]<BearLevel)
           {
            dn=true;
            DnRSI[shift]=RSI[shift];
           }
         else
           {
            dn=false;
            DnRSI[shift]=EMPTY_VALUE;
           }
        }
      // ========= Two-tone RSI Ends
      // ========= Squeeze Signals
      BBMA    =iMA(NULL,0,BBPrd,0,MODE_SMA,PRICE_CLOSE,shift);
      SBMA    =iMA(NULL,0,SBPrd,0,MODE_EMA,PRICE_CLOSE,shift+SBShift);
      TopBBand=iBands(NULL,0,BBPrd,BBDev,0,PRICE_CLOSE,MODE_UPPER,shift);
      BotBBand=iBands(NULL,0,BBPrd,BBDev,0,PRICE_CLOSE,MODE_LOWER,shift);
      TopSBand=SBMA + (SBFactor * iATR(NULL,0,SBATRPrd,shift+SBShift));
      BotSBand=SBMA - (SBFactor * iATR(NULL,0,SBATRPrd,shift+SBShift));
      TopBBandPrev=iBands(NULL,0,BBPrd,BBDev,0,PRICE_CLOSE,MODE_UPPER,shift+1);
      BotBBandPrev=iBands(NULL,0,BBPrd,BBDev,0,PRICE_CLOSE,MODE_LOWER,shift+1);
      if (TopBBand<TopSBand && BotBBand>BotSBand) Squeeze[shift]=50;
      // ========= Squeeze Signals Ends
      // ========= BB Breakout Signals
      //if(Squeeze[shift+2]==50 && RSI[shift]>50 && BotBBand<BotSBand) 
      if((Squeeze[shift+2]==50 || Squeeze[shift+1]==50) && RSI[shift]>50 && BotBBand<BotSBand)
        {
         Buy[shift]=ob;
         Sell[shift]=EMPTY_VALUE;
        }
      else
         //if(Squeeze[shift+2]==50 && RSI[shift]<50 && TopBBand>TopSBand) 
         if((Squeeze[shift+2]==50 || Squeeze[shift+1]==50) && RSI[shift]<50 && TopBBand>TopSBand)
           {
            Buy[shift]=EMPTY_VALUE;
            Sell[shift]=os;
           }
         else
            if(Buy[shift+1]==ob && BotBBand<BotBBandPrev && RSI[shift]>50)
              {
               Buy[shift]=ob;
               Sell[shift]=EMPTY_VALUE;
              }
            else
               if(Sell[shift+1]==os && TopBBand>TopBBandPrev && RSI[shift]<50)
                 {
                  Buy[shift]=EMPTY_VALUE;
                  Sell[shift]=os;
                 }
               else
                 {
                  Buy[shift]=EMPTY_VALUE;
                  Sell[shift]=EMPTY_VALUE;
                 }
      // ========= BB Breakout Signals Ends
     }
   // ======= Alert =========
   if(AlertOn)
     {
      if(prevtime==Time[0])
        {
         return(0);
        }
      prevtime=Time[0];
      BuyNow=Buy[0];
      BuyPrevious=Buy[1];
      SellNow=Sell[0];
      SellPrevious=Sell[1];
      if((BuyNow ==ob) && (BuyPrevious ==EMPTY_VALUE) )
        {
         Alert(Symbol(), " M", Period(), " Buy Alert");
        }
      else
         if((SellNow ==os) && (SellPrevious ==EMPTY_VALUE) )
           {
            Alert(Symbol(), " M", Period(), " Sell Alert");
           }
      IndicatorShortName("RSI("+RSIPeriod+") (Alert on)");
     }
   // ======= Alert Ends =========
   return(0);
  }
//+------------------------------------------------------------------+

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