Q: Tips

- Double smoothing makes TSI less noisy than single-smoothed oscillators - Signal line crossovers above zero are the strongest buy signals - TSI divergence with price is an excellent early reversal signal - Works well on daily and weekly charts for swing trading - Combine with trend indicators for filtering false signals in choppy markets

Question 1

What is TSI?

Accepted Answer

The True Strength Index (TSI) is a double-smoothed momentum oscillator that shows both the direction and overbought/oversold conditions of a trend. It uses double exponential smoothing of price changes to reduce noise while capturing the underlying momentum. TSI ranges roughly between -100 and +100.

Question 2

How it works

Accepted Answer

TSI applies double EMA smoothing to both the price change and its absolute value: ``` Double Smoothed PC = EMA(EMA(Close - Close[1], long), short) Double Smoothed APC = EMA(EMA(|Close - Close[1]|, long), short) TSI = (Double Smoothed PC / Double Smoothed APC) * 100 Signal = EMA(TSI, signal_period) ``` Sub-component: `TSI_SIGNAL` (signal line).

Question 3

Key levels

Accepted Answer

- **Above +25** — Strong bullish momentum (potential overbought) - **Below -25** — Strong bearish momentum (potential oversold) - **0** — Neutral point, separates bullish/bearish momentum - **Signal line crossovers** — Primary trading trigger

Question 4

Buy signals

Accepted Answer

- TSI crosses above its signal line (bullish crossover) - TSI crosses above 0 (momentum shift to bullish) - TSI rebounds from below -25 (leaving oversold)

Question 5

Sell signals

Accepted Answer

- TSI crosses below its signal line (bearish crossover) - TSI crosses below 0 (momentum shift to bearish) - TSI reverses from above +25 (leaving overbought)

Question 6

Parameters

Accepted Answer

| Parameter | Default | Description | |-----------|---------|-------------| | Long Period | 25 | First EMA smoothing period | | Short Period | 13 | Second EMA smoothing period | | Signal Period | 7 | Signal line EMA period |

Question 7

Example conditions

Accepted Answer

| Condition | Meaning | |-----------|---------| | `TSI(25,13,7) > 0` | Bullish momentum | | `TSI(25,13,7) cross_over TSI_SIGNAL(25,13,7)` | Buy signal | | `TSI(25,13,7) cross_under 0` | Momentum turned bearish | | `TSI(25,13,7) < -25` | Oversold territory |

Question 8

Tips

Accepted Answer

- Double smoothing makes TSI less noisy than single-smoothed oscillators - Signal line crossovers above zero are the strongest buy signals - TSI divergence with price is an excellent early reversal signal - Works well on daily and weekly charts for swing trading - Combine with trend indicators for filtering false signals in choppy markets