RSI (Relative Strength Index)
Momentum oscillator 0-100. Measures speed and amplitude of moves.
Neutral
Difficulty: ●●○○○
Reliability: 6/10
Invented by Welles Wilder. Standard period: 14.
Basic reading
- > 70: overbought → potential correction
- < 30: oversold → potential bounce
- 50: midline, directional bias
Advanced usage
Divergences are the real signal:
- Bearish: price makes new high, RSI lower high → hidden weakness
- Bullish: price makes new low, RSI higher low → likely recovery
In strong trends, RSI stays in extreme zone — don't trade against trend just on RSI > 70.
When to look
Any asset, any timeframe. More reliable in range than strong trend.
Confirmation
Combine with structure signal (pattern, S/R).