RSI Complete Guide

Relative Strength Index

momentumParams: period=14

What is RSI?

The Relative Strength Index (RSI) is a momentum oscillator developed by J. Welles Wilder Jr. in 1978. It measures the speed and magnitude of recent price changes to evaluate overbought or oversold conditions. RSI oscillates between 0 and 100, with readings above 70 traditionally considered overbought and below 30 considered oversold. The standard calculation uses a 14-period lookback. RSI divergences (price making new highs/lows while RSI does not) are among the most powerful reversal signals in technical analysis.

Formula

RSI = 100 - \frac{100}{1 + \frac{AvgGain}{AvgLoss}}

Signal Types

Overbought

RSI above 70 — price may be overextended to the upside

Oversold

RSI below 30 — price may be overextended to the downside

Related Indicators

MACD STOCHASTIC CCI

FAQ

What RSI level indicates overbought?

Traditionally, RSI above 70 is considered overbought. In strong uptrends, some analysts use 80 as the threshold.

What is RSI divergence?

RSI divergence occurs when price makes a new high (or low) but RSI fails to confirm. This suggests weakening momentum and a potential reversal.

Should I use 14-period RSI or a different setting?

14 periods is the standard. Shorter periods (7-9) are more sensitive, longer periods (21-25) are smoother. Choose based on your trading timeframe.

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Reviewed by KlineVision Research Team, CFA Charterholder, 10+ years quantitative research· 22 अप्रैल 2026

Parts of this page (FAQ, introductions) are AI-assisted. Core data and statistics are algorithmically computed. All pattern definitions are human-reviewed.

Data source: EODHD · Last updated: 22 अप्रैल 2026

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