The True Strength Index (TSI) indicator for MetaTrader4 is a technical tool that was designed by William Blau during the early 1990’s.
As a momentum-based indicator, it performs the core functions of spotting trends along with over-bought/over-sold conditions of a financial instrument by using the near-term purchasing momentum of the market with the lagging advantages of moving averages.
The True Strength Index (TSI) indicator fluctuates between the positive and negative region, with the center signal line determining the overall bias as with most momentum oscillators.
When the TSI is positive it denotes buyers having the momentum edge, while a negative TSI denotes sellers having the momentum edge.
Trend reversals can also be predicted using the True Strength Index (TSI), as traders can look for bullish and bearish divergences in anticipation of trend reversals.
The True Strength Index (TSI) is able to track underlying price a great deal i.e. sustained moves in either directions can be captured by the TSI. This means that the peaks and trough of the indicator will in most cases match those of price action.
Please bear in mind that if you alter the values or periods in the True Strength Index (TSI) parameter settings, the indicator will react to price movement appropriately. For instance, if you compute the True Strength Index for 45 periods, you will essentially minimize its sensitivity when compared to when computing for 14 periods.
MT4 Indicator Characteristics
Currency pairs: Any
Platform: Metatrader 4
Type: chart window indicator
Customization options: Variable (First_R, Second_3), Colors, width & Style.
Time frames: 5-Minutes, 15-Minutes, 30-Minutes, 1-Hour, 4-Hours, 1-Day, 1-Week, 1-Month
Type: momentum oscillator, trend, support and resistance