Indicator Overview

The Velocity RSI is an advanced momentum oscillator that refines the traditional Relative Strength Index (RSI) by incorporating price velocity, calculated using a lookback and a running moving average (RMA) smoothing. It measures the speed and direction of price changes relative to recent highs and lows, scaled to a 0–100 range.

Dual-Ticker Comparison Logic

The Ticker fields allow you to transition from absolute price analysis to relative strength analysis:

• Single Stock Analysis: If Ticker 2 is left blank, the indicator defaults to measuring Ticker 1against US Dollars. This allows you to analyse the asset's individual performance.

• Pair Trading & Ratios: Enter a symbol in both fields (e.g. NVDA vs. TSLA) to analyse the relationship between the two. The indicator automatically calculates the ratio (Ticker 1 / Ticker 2), helping you identify when one asset is becoming "expensive" or "cheap" relative to its peer, independent of broader market direction.

How To Use

The Velocity RSI oscillates around a 50 midline, with values above 80 signaling overbought conditions, often preceding price pullbacks, ideal for profit-taking or shorting. Values below 20 indicate oversold conditions, typically aligning with buying opportunities during dips.

Historically, peaks mark speculative tops, while troughs signal undervaluation. Traders can buy on dips below 20 and sell on spikes above 80. Investors may accumulate during oversold periods and reduce exposure in overbought zones, leveraging the indicator’s sensitivity to cyclical momentum for precise timing.