The RSI Divergence indicator is a technical analysis tool that identifies divergences between price movements and the Relative Strength Index (RSI). It detects situations where price and RSI trends do not align, signaling potential changes in market direction. The indicator automatically highlights bullish divergences—where price forms lower lows but RSI forms higher lows, suggesting possible upward reversals—and bearish divergences—where price forms higher highs but RSI forms lower highs, indicating potential downward reversals. These signals are displayed on the chart with colored labels and connecting lines for clear visualization.
Designed for use on any timeframe, the indicator helps traders identify entry and exit points, anticipate trend changes, and confirm other technical analysis signals. Users can customize parameters such as RSI period, pivot search ranges, signal colors, and enable or disable specific divergence types. Additionally, multiple RSI levels can be added to tailor the indicator to various trading strategies and styles.
This tool is suitable for intraday traders and long-term investors across markets including cryptocurrencies (e.g., BTCUSD), commodities (e.g., gold, XAUUSD), and indices. It supports enhanced decision-making by providing early warnings of trend strength shifts based on RSI divergence analysis.