RSI -> The NeW System

RSI → The NeW System 📊
A fully customizable Relative Strength Index with optional smoothing filters and dynamic color zones.

What is the RSI? 🤔
The Relative Strength Index (RSI) measures the speed and magnitude of price changes. It highlights overbought (> your “Extreme High”) and oversold (< your “Extreme Low”) conditions, and uses a midpoint (50) to separate bullish from bearish momentum.

Indicator Inputs ⚙️
RSI Source 📈
Price series for the RSI calculation (e.g. close, typical price).

RSI Length ⏳
Lookback period for the raw RSI.

MA Type for Smoothing 🔄
Choose how to filter the RSI line:

None – raw RSI, no smoothing.

SMA – Simple Moving Average of the RSI values.

EMA – Exponential Moving Average, weights recent values more.

WMA – Weighted Moving Average, linearly de-emphasizes older values.

HMA – Hull MA, very smooth with reduced lag via square-root period.

RMA – Wilder’s MA, the classic smoothing used in RSI.

LSMA – Least Squares MA (linear regression) to highlight trend slope.

DEMA – Double EMA (2×EMA – EMA of EMA) for minimal lag.

TEMA – Triple EMA (3×EMA – 3×EMA² + EMA³) for extra smoothness.

VIDYA – Variable Index Dynamic Average, adapts smoothing to RSI volatility.

MA Smoothing Length 📐
Period for your chosen MA filter.

Extreme High Level 🚩
RSI threshold for overbought (default: 70).

Extreme Low Level 🟢
RSI threshold for oversold (default: 30).

Middle Line ➖
Fixed at 50 to separate bullish (>50) from bearish (<50) momentum.

MA Types Explained 🔍
None: No filter; every RSI spike/dip is visible.

SMA: Evenly averages the last N values—solid smoothing but slower to react.

EMA: Weights recent data more—faster response, moderate smoothing.

WMA: Heavier weighting on newest points—quicker than EMA for the same length.

HMA: Uses weighted and square-root adjustments—super smooth and fast.

RMA: Wilder’s smoothing—very stable, minimal noise.

LSMA: Fits a regression line—excellent at showing the RSI’s trend direction.

DEMA: Combines two EMAs to cut lag—smooth with swift reactions.

TEMA: Uses three EMAs for ultimate lag reduction and smoothness.

VIDYA: Adjusts its smoothing factor dynamically based on volatility—stays smooth in calm markets, adapts quickly when volatility surges.

How It Works 🧮
Raw RSI: Calculate the classic RSI over your chosen length.

Optional Smoothing: If you pick an MA Type, the raw RSI is filtered accordingly.

Dynamic Coloring:

Above Extreme High → Dark red (overbought alert).

70 → 50 → Bright green (strong bullish momentum).

50 → 30 → Bright red (weakening momentum).

Below Extreme Low → Dark green (oversold opportunity).

Visual Aids:

Dashed red line at Extreme High.

Dashed green line at Extreme Low.

Dotted gray line at 50.

Background fill between the high/low zones for instant visual cues.

Raw RSI overlay (faint gray) behind the smoothed line when smoothing is active.

Plot & Interpretation 🎨
Smoothed RSI Line colored by zone for immediate strength/weakness reading.

Zone Background between overbought/oversold thresholds to highlight critical areas.

Optional Raw RSI behind the filter to compare noise vs. clarity.

Pro Tips 💡
EMA for balanced smoothing, HMA/DEMA/TEMA for lightning-fast signals, VIDYA for volatility-adaptive filtering.

Watch crosses of 50 on your smoothed line to confirm trend shifts.

Use extreme bounces (30 or 70) for mean reversion entries/exits; breakouts beyond them for trend confirmation.

Compare raw vs. smoothed lines to fine-tune signal sensitivity vs. noise suppression.

Tailor RSI → The NeW System to your strategy, whether you need razor-sharp entries or a cleaner, trend-focused view! 🚀