Hello,
I am looking at the outputs for the rsi.talib values compared to what is online and they don't match. For example during the last week of July the values for Tesla were in the 50-60 and when outputting rsi.talib its in the 40s. What is the difference here and why do they not align?
Thanks
Jon
The RSI calculations which various sources use are notoriously inconsistent. Many implementations don't match. There is one writeup here which explains some of the issues and the Wikipedia entry also alludes to some. One issue stems from the use (or not) of an exponential moving average to smooth the results. There are sometimes differences between the decay rate used and how the smoothing is done. Additionally, the length of the 'lookback' varies. Because the result is 'smoothed' by factoring in previous results, how many previous values are used will make a difference in the result (talib has a warning on this indicator that the function has an unstable period). The built-in RSI pipeline factor doesn't use any smoothing. The code for that calculation can be found here. Another smaller variation may stem from the close prices on Quantopian being the 'last traded price' where many other sources use the end of day auction price. Check out this post.
However, the attached notebook shows values for both talib and the built-in RSI factor, for TSLA during the last week of July 2020, to be between 50-60.
Hope that helps.
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The material on this website is provided for informational purposes only and does not constitute an offer to sell, a solicitation to buy, or a recommendation or endorsement for any security or strategy, nor does it constitute an offer to provide investment advisory services by Quantopian.
In addition, the material offers no opinion with respect to the suitability of any security or specific investment. No information contained herein should be regarded as a suggestion to engage in or refrain from any investment-related course of action as none of Quantopian nor any of its affiliates is undertaking to provide investment advice, act as an adviser to any plan or entity subject to the Employee Retirement Income Security Act of 1974, as amended, individual retirement account or individual retirement annuity, or give advice in a fiduciary capacity with respect to the materials presented herein. If you are an individual retirement or other investor, contact your financial advisor or other fiduciary unrelated to Quantopian about whether any given investment idea, strategy, product or service described herein may be appropriate for your circumstances. All investments involve risk, including loss of principal. Quantopian makes no guarantees as to the accuracy or completeness of the views expressed in the website. The views are subject to change, and may have become unreliable for various reasons, including changes in market conditions or economic circumstances.
