Synthetic Point & Figure on RSI

Here is a detailed description and user guide for the Synthetic Point & Figure RSI indicator, including how to use it for long and short trade considerations:

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## Synthetic Point & Figure RSI Indicator – User Guide

### What It Is
This indicator applies classic Point & Figure (P&F) charting logic to the Relative Strength Index (RSI) instead of price. It transforms the RSI into synthetic “P&F candles” that filter out noise and highlight significant momentum moves and reversals based on configurable box size and reversal settings.

### How It Works
- The RSI is calculated normally over the selected length.
- The P&F engine tracks movements in the RSI above or below a defined “box size,” creating columns that switch direction only after a larger reversal.
- The synthetic candles connect these filtered RSI values visually, reducing false noise and emphasizing strong RSI trends.
- Optional EMA and SMA overlays on the synthetic P&F RSI allow smoother trend signals.
- Reference RSI levels at 33, 40, 50, 60, and 66 provide further context for momentum strength.

### How to Use for Trading

#### Long (Buy) Considerations
- The synthetic P&F RSI candle direction flips to *up (green candles)* indicating strength in momentum.
- Look for the RSI P&F value moving above the *40 or 50 level*, suggesting increasing bullish momentum.
- Confirmation is stronger if the synthetic RSI is above the EMA or SMA overlays.
- Ideal entries are after a reversal from a synthetic P&F downtrend (red candles) to an uptrend (green candles) near or above these levels.

#### Short (Sell) Considerations
- The candle direction flips to *down (red candles)*, showing weakening momentum or bearish reversal.
- Monitor if the synthetic RSI falls below the *60 or 50 level*, signaling momentum loss.
- Confirm bearish bias if the price is below the EMA or SMA overlays.
- Exit or short positions are signaled when the synthetic candle reverses from green to red near or below these threshold levels.

### Important RSI Levels to Watch
- *Level 33*: Lower bound indicating deep oversold conditions.
- *Level 40*: Early bullish zone suggesting momentum improvement.
- *Level 50*: Neutral midpoint; crossing above often signals bullish strength, below signals weakness.
- *Level 60*: Advanced bullish momentum; breaking below signals potential reversal.
- *Level 66*: Strong overbought area warning of possible pullback.

### Tips
- Use in conjunction with price action analysis and other volume/trend indicators for higher conviction.
- Adjust box size and reversal settings based on instrument volatility and timeframe for ideal filtering.
- The P&F RSI is best for identifying sustained momentum trends and avoiding false RSI whipsaws.
- Combine this indicator’s signals with stop-loss and risk management strategies.

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This indicator converts RSI momentum analysis into a simplified, noise-filtered P&F chart format, helping traders better visualize and trade momentum shifts. It is especially useful when RSI signal noise can cause confusion in volatile markets.

Let me know if you want me to generate a shorter summary or code alerts based on these levels!

Sources
[1] Relative Strength Index (RSI) — Indicators and Strategies in.tradingview.com/scripts/relativestrengthindex/
[2] Indicators and strategies in.tradingview.com/scripts/
[3] Relative Strength Index (RSI) Indicator: Tutorial youtube.com/watch?v=O6BYFpXUh5I
[4] Stochastic RSI (STOCH RSI) in.tradingview.com/support/solutions/43000502333-stochastic-rsi-stoch-rsi/
[5] RSI Strategy docs.algotest.in/signals/pinescripts/rsi_strategy/
[6] Stochastic RSI Indicator: Tutorial youtube.com/watch?v=anoCSnDIwWU
[7] Relative Strength Index (RSI): What It Is, How It Works, and ... investopedia.com/terms/r/rsi.asp
[8] rsi — Indicators and Strategies in.tradingview.com/scripts/#rsi/
[9] Relative Strength Index (RSI) in.tradingview.com/support/solutions/43000502338-relative-strength-index-rsi/
[10] Relative Strength Index (RSI) — Indicators and Strategies tradingview.com/scripts/relativestrengthindex/page-40/?solution=43000589099