Reverse SMI: Plotting Prices That Reach Momentum Levels
Summary
This indicator inverts the Stochastic Momentum Index calculation to estimate the price at which the SMI would reach a chosen value. It plots corresponding price levels for the SMI’s current value, its signal line, the zero line, and configurable upper and lower alert thresholds. An information label compares the current price with those calculated levels, while optional color changes show whether the price is above or below them.
The method is useful for translating oscillator thresholds into chart prices, so a trader can see what close would move the SMI across a level. The script exposes settings for the SMI lookback, smoothing, signal length, price source, and display. The document explains the calculation’s intended interpretation but provides no market tests or performance evidence. Its levels are estimates derived from the indicator’s smoothed inputs; they do not establish that price will reach them or that an SMI crossing predicts profitable trades.
Key ideas
- The script estimates the price that would make the SMI equal a specified value.
- It plots price levels corresponding to the SMI signal, zero line, and optional alert thresholds.
- A chart label summarizes the calculated levels and their relationship to the current price.
- The indicator provides a way to interpret oscillator thresholds in price terms, without evidence of trading performance.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.