The Rex oscillator measures market behavior based on the relationship of the close to the open, high and low values of the same bar. A big difference between the high and close on a bar indicates weakness, and wide disparity between the low and close indicates strength. The difference between open and close also indicates market performance.

The True Value of a Bar (TVB) gives an indication of how healthy the market is. A negative close and a positive TVB (or vice versa) is an indication of the market building strength on the opposing side of the trend. The Rex oscillator is a moving average (SMA, EMA, WMA or SMMA) of the TVB value with the specified period.

Interpretation

When the Rex Oscillator turns positive in a bearish trend, a reversal is indicated. Likewise, Rex turning negative in a bull market indicates a reversal to the downside.

//PRC_Rex Oscillator | indicator
//06.01.2020
//Nicolas @ www.prorealcode.com
//Sharing ProRealTime knowledge
//converted from MT4 code

// --- settings
smoothlength=14
smoothmethod=0
signallength=14
signalmethod=0
// --- end of settings

TVB=3*Close-(Low+Open+High)

rex=average[smoothlength,smoothmethod](tvb)/pointsize
signal=average[signallength,signalmethod](rex)

return rex coloured(0,255,0),signal coloured(255,0,0)