RelativestrengthindexFromWikipedia,thefreeencyclopediaJumptonavigationJumptosearchIndicatorintechnicalanalysisTherelativestrengthindex(RSI)isatechnicalindicatorusedintheanalysisoffinancialmarkets.Itisintendedtochartthecurrentandhistoricalstrengthorweaknessofastockormarketbasedontheclosingpricesofarecenttradingperiod.Theindicatorshouldnotbeconfusedwithrelativestrength.TheRSIisclassifiedasamomentumoscillator,measuringthevelocityandmagnitudeofpricemovements.Momentumistherateoftheriseorfallinprice.TheRSIcomputesmomentumastheratioofhigherclosestolowercloses:stockswhichhavehadmoreorstrongerpositivechangeshaveahigherRSIthanstockswhichhavehadmoreorstrongernegativechanges.TheRSIismosttypicallyusedona14-daytimeframe,measuredonascalefrom0to100,withhighandlowlevelsmarkedat70and30,respectively.Shortorlongertimeframesareusedforalternatelyshorterorlongeroutlooks.Highandlowlevels—80and20,or90and10—occurlessfrequentlybutindicatestrongermomentum.TherelativestrengthindexwasdevelopedbyJ.WellesWilderandpublishedina1978book,NewConceptsinTechnicalTradingSystems,andinCommoditiesmagazine(nowFuturesmagazine)intheJune1978issue.[1]Ithasbecomeoneofthemostpopularoscillatorindices.[2]TheRSIprovidessignalsthattellinvestorstobuywhenthesecurityorcurrencyisoversoldandtosellwhenitisoverbought.[3]RSIwithrecommendedparametersanditsday-to-dayoptimizationwastestedandcomparedwithotherstrategiesinMarekandŠedivá(2017).Thetestingwasrandomisedintimeandcompanies(e.g.,Apple,ExxonMobile,IBM,Microsoft)andshowedthatRSIcanstillproducegoodresults;however,inlongertimeitisusuallyovercomebythesimplebuy-and-holdstrategy.[4]Contents1Calculation2Interpretation2.1Basicconfiguration2.2Principles2.3Divergence2.4Overboughtandoversoldconditions2.5Uptrendsanddowntrends2.6Reversals3Cutler'sRSI4Seealso5References6ExternallinksCalculation[edit]ForeachtradingperiodanupwardchangeUordownwardchangeDiscalculated.Upperiodsarecharacterizedbytheclosebeinghigherthanthepreviousclose:U=closenow−closeprevious{\displaystyleU={\text{close}}_{\te