🧬Range Indicator

The RSI in better!

The Range Indicator is a momentum indicator similar to the RSI. Unfortunately, the RSI is the most used momentum indicator, the divergences it offers are not relevant enough in my opinion. That's why I developed my own tool indicating the momentum of an asset: the Range Indicator. It allows you to get more signals and to refine your view of the market.

Its second moving average is very relevant to show the underlying trend of an asset.

The range indicator is used to identify potential reversal areas.

In this example, divergences (or hidden divergences) are "validated" if the indicator (RSI or RI) crosses its moving average.

The "Limit the price" calculation mode will limit the indicator between 0 and 100. The overbought zone is above 75 and the oversold zone is below 25.

You can spot divergences between the price and the indicator. Some more conservative traders will wait for a divergence, in a good price location, the bottom of a range for example. They then wait for the indicator to change color to white as a confirmation. It's up to you to see what you think is most relevant.

You can choose to limit the price or not. This gives a very different view.

Range Indicator with "limit price"

Range Indicator without "limit price"

A 5 color code indicates the strength of the momentum. Feel free to adapt these colors to your preferences.

• Dark orange: overbought

• Light orange: buying force

• Light grey: neutral state

• Light purple: selling strength

• Dark purple: oversold

Second MA

The "second MA" is a "house" moving average, it is very effective to spot the underlying trend of an asset as you can see below:

Second MA with Bitcoin

Second MA with Ethereum

Settings

Settings

In the settings you can:

• Choose to limit the price from 0 to 100 like an RSI for example, or to display the calculation in "free" mode,

• Change the parameters of the main moving average (length, source and different color modes),

• Choose whether or not to add a second moving average,

• Define a length and the crossing mode.

Style Settings