Description

• Founded by William Blau, TSI is a momentum oscillator used to determine over bought and sold situations
• It is also called variation of RSI with function to measure momentum and correlate it to price trend using averages
• It uses double smoothened EMA to make indicator reactive to only major market turns
• It oscillates between -100 to 100

Interpretation

• If the indicator value falls below -50, stock is oversold
• If indicator value falls rises above +50, stock is overbought
• Cutting level +50 from above in the downward direction gives short signal
• Cutting level -50 from below in the upward direction is a buy signal

Default Parameters Used/Inputs

• Close Line
• Smooth Bars
• Dbl Smooth Bar

Returns/Output

True Strength Index values of stock for the specified period.

Formula

TSI= [EMAn (EMAn(mtm)) / EMAn (EMAn (|mtm|) ]
where,
mtm = (mark to market) or (close – Pvs Close)
l mtm l = Absolute mark to market