RE: Different RSI in MetaStock ?

["Jay Cruce" <jcruce@xxxxxxxxxxxxx>]

I once ran into a similar problem trying to find out why TC2000 and
Metastock RSI numbers were different.  I found that Metastock did have the
correct numbers.

The kicker is that Metastock and uses the original way Welles Wilder defined
the system.  It is different from your spread sheet, mainly in how it gets
subsquent UP and DOWN closes.

Also make sure that Metastock starts the calculation at the same point that
you do.  As I remember, different starting points  may make a difference.

Below is the method I copied out of Welles Wilder's original book 'New
Concepts in Technical Trading Systems'.

1. Obtain the sum of the UP closes for the previous 14 days and divide this
sum by 14.  This is the AVERAGE UP close.

2. Obtain the sum of the DOWN closes for the previous 14 days and divide
this sum by 14.  This is the AVERAGE DOWN close.

3. Divide the AVERAGE UP close by the AVERAGE DOWN close.  This is the
Relative Strength (RS)

4. Add 1.00 to RS.

5. Divide the result obtained in Step 4 into 100.

6. Subtract the result obtained in Step 5 from 100.  This is the first RSI.

For subsequent RSI values.  Step 1 and 2 below are definitely different from
just adding up the UP and DOWN closes then taking an average.

1. To obtain the next AVERAGE UP close; Multiply the previous AVERAGE UP
close by 13, add to this amount today's UP close (if any) and divide the
total by 14.

2. To obtain the next AVERAGE DOWN close; Multiply the previous AVERAGE DOWN
close by 13, add to this amount today's DOWN close (if any) and divide the
total by 14.

3., 4., 5., 6. Are the same as for the original RSI


Bottom line for me is that I believe Metastock is correct.

I hope this helps and just doesn't confuse the issue more.

Jay Cruce



-----Original Message-----
From: owner-metastock@xxxxxxxxxxxxx
[mailto:owner-metastock@xxxxxxxxxxxxx]On Behalf Of onno goedknegt
Sent: Wednesday, December 19, 2001 12:46 PM
To: metastock@xxxxxxxxxxxxx
Subject: Different RSI in MetaStock ?


Hi all,

I wondered if others have noticed the same.
It seems that the calculation for RSI in MetaStock differs from the
standard RSI calculation.

I ‘m trying to “translate” my MetaStock trading system into an Excel
sheet.
And because my MetaStock trading system contains RSI, I need
to “translate” the RSI calculation into Excel.

Attached Excel sheet contains my RSI calculation (sheet: calc 1).
Other calculations downloaded from the Internet give the same values
for RSI as my calculation (sheet: calc 2).

MetaStock RSI values are shown in red.

1. Which version is correct ?
2. How does MetaStock calculate their RSI ?

Thanks for your input.

Kind regards,
Onno