Laguerre RSI

Indicators · Oscillators

Ehlers's Laguerre RSI — fast, smooth bounded oscillator (0..1).

Laguerre RSI is John Ehlers's reworking of the RSI into something far smoother and faster to respond. It lives in a tidy 0–1 band like a normalised RSI, but instead of a fixed lookback it runs price through a short Laguerre filter first, so it snaps to overbought/oversold with very little lag and almost none of the ragged false flips a short-period RSI throws off. You get the line plus ready-made overbought and oversold boolean outputs.

How it works

Price (your Source, default close) is passed through a four-stage Laguerre filter — L0, L1, L2, L3 — whose memory is controlled by a single Gamma (damping) factor (default 0.5). Low gamma is fast and responsive; high gamma is slow and glassy. The four stages are then fed into an RSI-style cumulative up/down ratio:

CU/CD = sums of the up/down differences across L0 > L1 > L2 > L3
Laguerre RSI = CU / (CU + CD)        # bounded 0..1

The result sits in a sub-pane, scaled 0–1. The OB output fires when it pushes above Overbought (default 0.8) and OS below Oversold (default 0.2); those two levels are drawn as dashed guides. Because the filter seeds from zero, the line is defined from the first bar.

When to use it

Use it like RSI — fade extremes in ranges, time pullbacks in trends — but where a normal RSI is too laggy or too jittery. The Laguerre smoothing lets you run a responsive overbought/oversold signal without dropping to a noisy 5- or 7-period RSI. It's well suited to faster timeframes and to mean-reversion entries that need to fire promptly when momentum exhausts. The usual oscillator caution applies: in a powerful trend the line can pin near 0.8/0.2, so confirm with a regime filter before fading.

Example

Laguerre RSI on EURUSD · H1

A crisp pullback long: wire bars into Laguerre RSI, take the OS output and require the line to turn back up out of oversold via a Crosses Above, into a Tester. Gate it to an uptrend with a higher-timeframe EMA or ADX / DMI, and backtest in the Tester. Nudge Gamma up if you want fewer, calmer signals.

Tips & gotchas

• Gamma is the only speed knob — lower = faster and twitchier, higher = smoother and slower. Most traders sit around 0.5–0.7.
• It's 0–1, not 0–100 — set thresholds accordingly (0.8/0.2 are the conventional extremes).
• Far less whipsaw than a short-period RSI at comparable responsiveness — that's the reason to choose it.
• Overbought still isn't "sell." In a strong trend it can hug the top band; filter the regime before fading.

Related blocks

• RSI
• Chande Momentum
• Two-Pole Super Smoother
• Stochastic

Inputs

Socket	Type	What to wire in
Source	bars / series	Price bars or any indicator series

Outputs

Output	Type	Plots as	Description
Laguerre RSI	series	Line · sub-pane	Laguerre RSI (0..1)
OB	signal	—	Above the overbought level
OS	signal	—	Below the oversold level

Parameters

Parameter	Type	Default	What it does
Gamma (damping)	number · 0.0–0.99	0.5
Overbought	number · 0.5–1.0	0.8
Oversold	number · 0.0–0.5	0.2
Source	choice (close, open, high, low, hl2, hlc3, ohlc4)	close
Line color	colour	#26c6da

Chart guides

This indicator draws reference level(s): overbought, oversold.

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Reference auto-generated from the block catalog · category Indicators.