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Francois Bertrand’s article, “RSI Bands” describes the calculation and use of these bands.
The MetaStock formulas and instructions on adding it to MetaStock
are:
To enter these indicators into MetaStock:
<li class="MsoNormal">In the Tools menu, select Indicator Builder.
<li class="MsoNormal">Click New to open the Indicator Editor for a new
indicator.
<li class="MsoNormal">Type the name of the formula: RSI Bands
<li class="MsoNormal">Click in the larger window and type in the formula:
<li>topv:=Input("overbought level",1,100,70);
<li>botv:=Input("oversold level",1,100,30);
<li>tp:=Input("RSI Time Periods",1,100,14);
<li>change:= ROC(C,1,$);
<li>Z:=Wilders(If(change>0,change,0),tp);
<li>Y:=Wilders(If(change<0,Abs(change),0),tp);
<li>tx:=(tp-1)*(Y*topv/(100-topv)-Z);
<li>bx:=(tp-1)*(Y*botv/(100-botv)-Z);
<li>tband:=If(tx>0,C+tx,C+tx*(100-topv)/topv);
<li>bband:=If(bx>0,C+bx,C+bx*(100-botv)/botv);
<li>tband;
<li>bband
<li class="MsoNormal">Click Ok to close the Indicator Editor.
The article also make reference to using “clamping” when the number
volatility caused the bands to widen beyond a usable range. Here is the same
indicator with the option to enable clamping at a variable range:
Name: RSI Bands with clamping
Formula:
<li>topv:=Input("overbought level",1,100,70);
<li>botv:=Input("oversold level",1,100,30);
<li>tp:=Input("RSI Time Periods",1,100,14);
<li>clamp:=Input("use clamping 1=Yes/0=No",0,1,0);
<li>cper:= Input("clamping percent",5,50,10);
<li>change:= ROC(C,1,$);
<li>Z:=Wilders(If(change>0,change,0),tp);
<li>Y:=Wilders(If(change<0,Abs(change),0),tp);
<li>tx:=(tp-1)*(Y*topv/(100-topv)-Z);
<li>bx:=(tp-1)*(Y*botv/(100-botv)-Z);
<li>tb1:=If(tx>0,C+tx,C+tx*(100-topv)/topv);
<li>bb1:=If(bx>0,C+bx,C+bx*(100-botv)/botv);
<li>tband:=If(clamp=1 AND tb1>C*(1+cper/100),C*(1+cper/100),tb1);
<li>bband:=If(clamp=1 AND bb1<c*(1-cper 100),c*(1-cper=" 100),bb1);="><li>tband;
<li>bband
William Golson
Equis International
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