Description
The Slow Volume Strength Index (SVSI), designed by Vitali Apirine, is a momentum-based oscillator that shares the principles of the well-known Relative Strength Index (RSI). SVSI can be considered a measure of change in buying and selling pressure. The calculation of the SVSI involves applying the standard oscillator formula to values of slow volume strength (the ratio of average positive volume to average negative volume).
In SVSI, volume is considered positive when the close is above its exponential moving average and negative when it is below. If the close price is equal to its average, the volume is considered equal to zero. Absolute values of both positive and negative volumes are then subjected to Wilder's smoothing and the ratio of the smoothed values is transformed into an oscillator.
Just like many other oscillators, SVSI has many applications:
- Default overbought and oversold levels for the oscillator are 80 and 20, respectively;
- Crossovers with the middle line and divergences might provide useful trading signals;
- SVSI can be also used for confirmation of another Mr. Apirine's oscillator, the Slow Relative Strength Index (SRSI).
Input Parameters
ema length
|
The period over which the exponential moving average is calculated. |
vsi length
|
The period over which the Wilder's average is calculated. |
over bought
|
Defines the overbought level. |
over sold
|
Defines the oversold level. |
Plots
SlowVSI
|
The Slow Volume Strength Index oscillator. |
OverBought
|
The overbought level. |
MiddleLine
|
The middle line. |
OverSold
|
The oversold level. |
Further Reading
1. "The Slow Volume Strength Index" by Vitali Apirine. Technical Analysis of Stocks & Commodities, June 2015.
Example*
*For illustrative purposes only. Not a recommendation of a specific security or investment strategy.