True Strength Indicator (TSI)


True Strength Indicator (TSI)

Variable List Abbreviation: TSI


Variable Mode(s): Standard, Stock, Futures1, and Futures2

[ Note: uses selected close variable in Stock, Futures1, and Futures2 modes ]


Parameter(s): TSI inside factor, TSI outside factor



Price momentum oscillator which smoothes the noise in momentum to indicate changes in market trends.  Useful for detecting overbought and oversold market conditions, which in turn indicate the possibility of a reactionary trend reversal.  The noise in the momentum is reduced by using a double smoothing.  It has been suggested that the inner exponential average be a long term smoothing, while the outer exponential average be a short term smoothing.



                        TSI = 100 *           ExpMovAvg ( ExpMovAvg ( momentum ) )              

                           ExpMovAvg ( ExpMovAvg ( absolute value of ( momentum ) ) )


momentum = value - previous value