Glossary Term

Relative Strength Index (RSI)

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Relative Strength Index is an indicator used in technical analysis to determine overbought and oversold conditions in a market. It was originally described by J. Welles Wilder Jr in the late 1970’s and has grown to become one of the most popular indicators in the whole of technical analysis. RSI is presented as a figure ranging from 0 to 100. When the number reaches 30 it is considered an oversold signal. When it reaches 70, it is considered as an overbought signal. By default RSI takes the previous 14 candles into account in its calculation of overbought and oversold conditions, however many traders increase this number in order to smooth out the results and reduce the volatility of the signal.

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What is relative strength index (RSI)? A Traders Expert explanation

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