RSI_Magnifier:
The jagged RSI that we all know, is very useful as a trendline tool. Or rather, you can use trendlines on that signal and get better signals than drawing trend lines on the price bars. No one ever told me that.
This new version has many new bells and whistles added. It has a new signal line and two different moving averages. The Signal line is a line that follows the main RSI line as the RSI moves away from the signal, but then the signal jumps to the other side of the RSI when the RSI retreats and touches the signal line. This gives a definitive signal that says the RSI is rising or falling. This version of RSI_Magnifier comes set to the standard 14 period for the RSI. You might want to change that. Smaller gives a faster but more jagged line. Longer gives a more flat line that follows the price more accurately before it saturates and rolls over.
If you downloaded the "Classic_Boundary_Breakout_Strategy .pdf" available on this site, you can see where this started. Valimir Ribakov is a great trader and he wrote that PDF. But, I feel he did not go far enough. I have no use for the 50 line as a qualifing level for the RSI. Levels have little to do with anything. It's the jagged peaks and valleys of this signal that tell you when the market is turning. And this RSI_Maganifer is a larger signal than the traditional RSI. You can see the jags and draw trend lines easier with this indicator than with the traditional RSI.
For example, this is a short Flash movie of how to use the RSI Magnifier.
You do need to use judgment when to accept a breakout signal. Often, there is congestion at a turning point and you will have to ride it out if you jump in too quickly. I'd give it a bar or two after a closed bar break out before entering a trade. You need to trade with this for some time before you commit money and learn for yourself the win/loss rate for this indicator on your currency pair.
For those with up to date Windows Media Players and the latest codecs you can download this really big wmv file RSI_Trendlines Lesson that goes into a LOT more detail on how to use RSIMagnifier. It's like a 20 minute lesson as we work our way down the price chart drawing trendlines. You need WMP 11 and the codec pack from Free Codec pack for WMP, It is free. Download, then double click it to install the codecs and then try to play the file again. This link should work, the one posted earlier stopped working.
I hope you find this indicator useful. It's the core of my own trading at the moment. I really can't imagine ever seeing anything better than this indicator.