Ultimate Strength Index
A lag-reduced version of the RSI using UltimateSmoother on smoothed up/down components.
Usage
Use to measure the relative strength of the current market move normalized to the dominant cycle amplitude, giving a volatility-adjusted momentum reading.
Background
The Ultimate Strength Index measures directional momentum as a fraction of the total cycle amplitude. By normalizing momentum to the RMS energy of the dominant cycle, it produces a consistent 0-100 reading that is comparable across different instruments and volatility regimes.
Parameters
length(default: 14): UltimateSmoother period
Formula
[ \text{SU} = \max(0, \text{Close} - \text{Close}{t-1}) ] [ \text{SD} = \max(0, \text{Close}) ] [ \text{USU} = UltimateSmoother(SMA(\text{SU}, 4), Length) ] [ \text{USD} = UltimateSmoother(SMA(\text{SD}, 4), Length) ] [ \text{USI} = \frac{\text{USU} - \text{USD}}{\text{USU} + \text{USD}} ]} - \text{Close