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A Comprehensive Guide to Relative Strength Index (RSI)
Technical analysts use the Relative Strength Index (RSI) as a momentum indicator. In order to determine whether a security’s price is overvalued or undervalued, it analyses the rate and magnitude of recent price fluctuations. Developed by J. Welles Wilder Jr., the RSI is represented as an oscillator on a scale from zero to 100. It was first published in his seminal 1978 book, “New Concepts in Technical Trading Systems.” The RSI can indicate potential shifts in trend or corrective price declines in addition to identifying securities that are overbought or oversold. With an RSI reading of 70 or higher indicating ... (full story)