What the Relative Vigor Index measures
The Relative Vigor Index (RVI) is an oscillator. An oscillator is an indicator that moves around a centre line in a separate window below the price chart.
The idea behind the RVI is simple. In a rising market, candles often close above their open. In a falling market, they often close below it. The RVI compares the candle body (close minus open) with the full candle range (high minus low). Strong candles that close near the high push the RVI up. Strong candles that close near the low push it down.
It belongs to the same family as the RSI indicator and the Stochastic oscillator. The difference is that it measures body against range, not close against past closes.
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Formula and default settings
The calculation has three steps:
- Smooth the numerator. Take close minus open for the recent bars. Average them with a short symmetric weighting that gives more weight to the middle bars.
- Smooth the denominator. Do the same with high minus low.
- Average and divide. Average each smoothed series over the chosen period, then divide the numerator by the denominator.
The signal line is a short weighted average of the RVI line itself.
In MetaTrader, the indicator has a single input, the period. The default value is shown in the inputs window when you add the indicator. A longer period gives a smoother line that reacts later. A shorter period reacts faster and produces more crossings.
How to add the RVI in MT4 and MT5
In both platforms, open Insert → Indicators → Oscillators → Relative Vigor Index. Set the period and colours, then confirm. The RVI line and the signal line appear in a sub-window. For more about the platforms, see Platforms and apps.
How to read it: a drawn example
The chart below is drawn for illustration only. It shows no real prices.
Common readings:
- Above the centre line: recent candles closed mostly above their opens.
- Below the centre line: recent candles closed mostly below their opens.
- RVI crossing its signal line: body strength is changing direction.
- Divergence: price makes a new high but the RVI makes a lower peak, as in the drawing. See Divergence.
These readings describe what candles did. They do not predict what price will do next.
Where the RVI misleads
- Ranges and flat markets: the lines cross often and produce noise.
- Gaps: the body ignores the jump from the previous close, so strength can look smaller than it was.
- Doji and tiny ranges: when high and low are close together, small bodies can swing the ratio sharply.
- Strong trends: divergence can appear many times while the trend continues.
- Lag: smoothing delays every reading. See Leading vs lagging.
Parameter choices for experienced traders
- Match the period to the timeframe. Short periods on low timeframes mostly trace spread and noise.
- Confirm the RVI with structure. Check Support and resistance or Multiple timeframes rather than relying on crossings alone.
- Compare it with the Momentum Indicator. If both disagree with price, note it, but treat it as context, not a trigger.
- Any RVI indicator strategy should be tested on a demo before real money is involved. Leveraged forex and CFD trading can lose money fast. Read Risk management.
Frequent questions
What are the usual relative vigor index settings?
The only input is the period. MetaTrader shows its default value when you add the indicator. Adjust it for the timeframe and test the change before relying on it.
Is the RVI a leading indicator?
No. It is smoothed, so it reacts after candles form.
Does the RVI work on gold and indices?
It calculates on any chart. Gaps and sharp spikes on these instruments can distort it.
Can the RVI tell me when to enter a trade?
No. It describes candle strength. Decisions need your own analysis and risk limits.