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RSI (Relative Strength Index)

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In one line: A 0–100 score of how strong recent up-moves were compared with down-moves.

RSIA 0–100 gauge of how strong recent gains are compared with losses. was introduced by J. Welles Wilder in 1978. The standard setting uses 14 periods. Above 70 is commonly called 'overbought' and below 30 'oversold' (source: StockCharts, secondary).

'Overbought' does not mean 'about to fall'. Strong trends can stay overbought for a long time. Like a song that stays in the charts long after you are sick of it.

Want to know if an RSI rule works? Test it with costs: How to test a trading claim.

Related

Sources & studies

  1. StockCharts ChartSchool (secondary): RSI
  2. Investopedia (secondary): Relative Strength Index (RSI)

IndicatorsMACDMoving averages

Last checked: 2026-11-04 · Educational, not financial advice.

Education only, not financial advice. No signals. Backtests are hypothetical: real trading can be worse. Past results don't predict future results.