TradingBot - Multi-RSI Histogram & Signal Smoother

Multi-RSI Histogram & Signal Smoother

This indicator combines three RSI calculations and transforms their relative differences into a histogram, allowing users to observe shifts in momentum and market character in a structured, visual format. The goal of this tool is to present RSI-based relationships in a way that is easier to interpret compared to individual RSI lines, especially in environments where price moves between trending and ranging behaviour.

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How It Works (Objective Explanation)
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- The script calculates three RSI values using different lengths.
- It measures their relative differences (RSI3–RSI7, RSI7–RSI14, RSI3–RSI14).
- These three difference values are combined into a single histogram.
- A moving average (EMA) of the histogram is plotted to highlight short-term changes in the aggregated signal.

This approach allows users to view how multiple RSI speeds diverge or converge, which may help them evaluate momentum shifts. The histogram uses a gradient color scale purely for visual clarity.

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What the Indicator Shows (Non-Promotional)
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- Increasing histogram values simply mean the faster RSIs are rising relatively stronger than the slower RSIs.
- Decreasing histogram values indicate the opposite — fast RSIs weakening relative to slower ones.
- The EMA line smooths the raw histogram to make the changes easier to observe.

This indicator does not predict future price movement. It only reflects the real-time relationship between different RSI settings.

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Possible Use Cases (Allowed Under TradingView Rules)
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These are general technical-analysis use cases, not financial advice:

1. Identifying momentum compression or expansion
- When the histogram stays near zero, the different RSIs are close together.
- This may occur during consolidation phases.

2. Observing momentum transitions
- A shift from negative to positive values (or vice versa) shows a relative change in RSI behaviour.
- The EMA may help users track such transitions more smoothly.

3. Supporting existing strategies
- This indicator can be used as an additional layer of confirmation in systems that already rely on momentum or RSI-based tools.
- It should not be used as a standalone decision-making tool.

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Important Notes (Required for House-Rule Compliance)
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- This indicator does not generate buy or sell signals.
- It is not a guarantee of performance and should not be interpreted as financial advice.
- Past performance of any technical method does not ensure future outcomes.
- Users should test this script and adjust parameters based on their own preferences and trading approach.