Coloring Candles by RSI Zone and the 50 Level
Summary
The RSIdivCandle indicator maps RSI conditions to candle colors so that oscillator zones can be read directly on a price chart. It uses separate colors for overbought and oversold readings, and distinguishes readings above or below the midpoint when RSI is outside those extreme zones. This makes the indicator a visual aid for spotting the oscillator’s broad state alongside price movement.
The description explains the color mapping but gives no entry or exit rules, parameter settings for the overbought and oversold boundaries, or evidence that the coloring improves trading results. It should therefore be understood as a chart-display convention rather than a standalone strategy or a tested signal. Traders would need to define thresholds and evaluate any use in their own market and timeframe.
Key ideas
- The indicator colors candles according to the RSI oscillator’s state.
- Overbought and oversold readings receive distinct colors.
- Outside extreme zones, candle color indicates whether RSI is above or below 50.
- The description provides no trading rules or performance evidence.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.