Relative Vigor Index (RVI): What the Signal Line Really Is
Two lines appear when this indicator loads, and the second one is described incorrectly by the most widely read guide to it. The platform that ships the indicator states plainly how that line is built. A guide with far more readers states something different, and the two descriptions produce different lines from identical data.
Key takeaways
- The index compares where price closed against where it opened, scaled by the whole range of the bar.
- MetaQuotes documents the signal line as a four-period symmetrically weighted average of the index values.
- A widely read guide calls that same line a four-period volume weighted average, which is a different calculation.
- On a spot currency chart the distinction has teeth, because the volume series there counts ticks rather than contracts traded.
- The MetaTrader function takes one averaging period and returns both lines, so the signal line is fixed rather than adjustable.
Table of contents
What the Relative Vigor Index Compares
The calculation begins with how far a bar finished from where it started. MetaQuotes sets out the reasoning behind it in the MetaTrader 5 help: in a rising market the close tends to finish above the open, and in a falling market the reverse tends to hold, so the position of the close relative to the open carries the direction of the bar.
That raw distance is not comparable between a quiet bar and a violent one, so it is divided by the full range of the bar. A close near the top of a wide bar and a close near the top of a narrow bar then produce similar values, which is the point of the scaling.
The result is smoothed. The MetaTrader 5 help states that a simple moving average is used for that smoothing and names ten as the period it considers best. The same open-to-close comparison sits underneath other tools as well, including the one covered on our page about the stochastic oscillator, which measures the close against a range rather than against the open.
The Signal Line Is Symmetrically Weighted, Not Volume Weighted
The second line is where the published descriptions part company.
The MetaTrader 5 help states that the signal line is a four-period symmetrically weighted moving average of the index values, and gives the reason for it: without a second line the readings are ambiguous, and the second line resolves that ambiguity.
A symmetrically weighted average puts its heaviest weight in the middle of the window and lighter weight at both ends. Nothing in it refers to volume. It is a shape imposed on four consecutive readings, and it is fully determined once those four readings exist.
The shape matters for where the line sits. Weighting that peaks in the middle of the window treats the oldest and newest of the four readings alike, so the line tracks the centre of the recent stretch rather than leaning toward the latest bar. An average that leaned on the newest reading would turn sooner and cross sooner. The vendor description therefore fixes not only the length of the line but how quickly it responds.
The most widely read of the two explanations available for this page describes the same line as a four-period volume weighted moving average. A volume weighted average is a different object. It weights each of the four readings by how much traded during that bar, so two charts with identical prices and different volume produce different signal lines.
Both descriptions agree that the line covers four periods, and both agree that the main line is a simple average with a default of ten. The disagreement is confined to the weighting, and it is the part that decides where the line sits.
| Statement | Platform documentation | The widely read guide |
|---|---|---|
| Main line smoothing | Simple moving average | Simple moving average |
| Main line period | Ten, described as best | Ten, described as the default |
| Signal line length | Four periods | Four periods |
| Signal line weighting | Symmetrically weighted | Volume weighted |
Why That Difference Matters on a Currency Chart
On an exchange traded instrument the two descriptions would at least be measuring comparable things, because volume there counts contracts that changed hands.
Spot currency trading has no such central record. What a forex chart labels volume is a count of price updates received by the platform, which rises when quotes arrive quickly and falls when they arrive slowly. Our page on the tick count a forex chart reports as volume sets out that distinction and the MetaQuotes documentation behind it, and the point is not repeated here.
The consequence for this indicator is narrow and specific. A reader who follows the volume weighted description on a currency pair is weighting four readings by how busy the quote feed was, which is not what the sentence they read intended and not what the platform computes. The line they end up with is not the line the vendor documents, and any crossover they take from it happens at a different bar.
A reader on a stock or futures chart faces the smaller version of the same problem: the two descriptions still disagree, but at least the weighting quantity means what it says.
MetaTrader Exposes One Period, Not Two
There is a second consequence that neither explanation mentions, and it is visible in the platform interface rather than in any article.
The MQL5 function that creates this indicator takes the symbol, the timeframe and a single averaging period. It returns a handle from which both the index values and the signal line values are read. One number is supplied by the caller; the four-period signal line is not among the arguments.
So on MetaTrader the advice to adjust the trigger line has nothing to act on. The main period can be changed. The signal line cannot, because the platform builds it from a fixed rule rather than from a setting. A reader who goes looking for a second input will not find one, and may reasonably conclude their copy is broken.
That is the opposite of the situation on some other oscillators, where every period is exposed and none of them is set by anybody. Our page on an oscillator whose periods no vendor sets at all describes that case, and the contrast between the two is worth holding: here the platform decides and tells you, there it declines to decide.
What a Crossover Does and Does Not Establish
The MetaTrader 5 help describes the two lines coming together as the event the indicator is watched for. That is a description of the construction and not a claim about outcomes, and the documentation attaches no success rate to it.
What a crossing establishes is arithmetic: the latest readings have moved far enough relative to the four-period average of recent readings for the two to meet. Since the main line is already a ten-period average of a ratio, and the signal line is a four-period average of that average, a crossing describes a change that has been under way for several bars.
The two smoothings compound rather than run side by side. A ratio that changed decisively three bars ago has entered ten readings of the main average and then four readings of the signal average, so both lines are still absorbing it when the crossing occurs. Lengthening the main period widens that distance further, which is the trade a reader makes when reaching for a smoother line.
Neither readable explanation offers evidence for how often a crossing is followed by a move in the same direction, and no figure of that kind appears on this page, because none of the sources consulted supports one.
Where the Reading Breaks Down
The scaling divides by the range of the bar, so a bar whose high and low are close together makes the denominator small and the ratio large. A quiet session can therefore produce an extreme reading from an ordinary move.
Bars that open where the previous one closed carry a small numerator by construction, which is common on instruments that trade continuously and rarer on those that gap. The indicator was described for daily data and the same arithmetic runs on any timeframe, with the ratio becoming noisier as the bars get shorter.
The reverse case is worth naming too. A bar with a very wide range and a close near its open produces a reading close to zero however large the move in price was, because the numerator stays small while the denominator grows. Two sessions that a trader would describe very differently can therefore leave a similar mark on this indicator.
Neither case is a fault in the calculation. Both follow from dividing one distance by another, and both are reasons to read the indicator alongside the bars that produced it rather than on its own.
Which Traders This Suits
If you trade on MetaTrader and want a tool whose second line is defined by the platform rather than by a setting you have to choose, this one qualifies, and the documentation states exactly what it does. If you want to tune both lines, this is the wrong indicator on that platform, because only one period is yours to set.
If you are reading about it anywhere other than the vendor documentation, check the weighting claim before you act on the description, and treat any volume weighted version on a currency pair as measuring the quote feed. Our overview of the technical toolkit places this indicator among the others and is the wider context for that decision.
Risk notice. This page is educational and describes how one technical indicator is constructed and what its documentation states. Nothing here is a recommendation to buy or sell any instrument, no reading of any indicator is a forecast, and no figure above is presented as a result anyone should expect. Leveraged trading carries a high risk of loss.