It will delete any labels of the same kind within the last 3 candles so you don't see as many labels as you would otherwise.
Red labels with white text represent overbought levels as defined by the user.
Green labels with black test represent oversold levels as defined by the user.
This overlay help easily call-out overbought and oversold candles on a chart without sacrificing screen space for a traditional indicator that is not overlayed on the chart.
Be mindful, this indicator can repaint in certain instances since it deletes up to the 3 most recent candle's worth of call-outs.
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In true TradingView spirit, the author of this script has published it open-source, so traders can understand and verify it. Cheers to the author! You may use it for free, but reuse of this code in a publication is governed by House Rules. You can favorite it to use it on a chart.