Relative Vigor Index (RVI)

$25.00

The Relative Vigor Index (RVI) was described by John Ehlers in an article titled 'Something old, something new' from the “Technical Analysis of Stocks and Commodities” magazine, January 2002. The indicator attempts to identify trend direction using the basic assumptions that prices tend to close higher in an uptrending market, and inversely, close lower in a downtrending market.

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Description

The Relative Vigor Index (RVI) was described by John Ehlers in an article titled ‘Something old, something new’ from the “Technical Analysis of Stocks and Commodities” magazine, January 2002. The indicator attempts to identify trend direction using the basic assumptions that prices tend to close higher in an uptrending market, and inversely, close lower in a downtrending market.

This implementation is as per John Ehlers original specification, resulting in two lines plotted, the RVI line and Signal line. Signals are generated when the lines cross.

Inputs

  • RVIPeriods – The number of periods to use in calculating the RVI line. The default value is 10.

Example Use

  • The further the value away from the 0-value, the stronger the current price trend is.
  • Buy when the green RVI line crosses the red Signal line from below.
  • Sell when the green RVI line crosses the red Signal line from above.
  • Convergence/Divergence can also be interpreted from this indicator.
RVI example.

RVI Example from June 2013 on AUDJPY.H1

Further Reading

http://www.forexgurus.co.uk/indicators/rvi-relative-vigor-index
http://www.ifcmarkets.com/en/ntx-indicators/relative-vigor-index
http://www.forextraders.com/forex-indicators/relative-vigor-index-indicator-explained.html