Relative Strength Index

      28
Dan Blystone is the founder và editor of TradersLog.com, as well as the founder of the Chicago Traders Meetup Group.

Bạn đang xem: Relative strength index


Charles is a nationally recognized capital markets speciamenu và educator who has spent the last three decades developing in-depth training programs for burgeoning financial professionals.

The Relative Strength Index (RSI) describes a momentum indicator that measures the magnitude of recent price changes in order khổng lồ evaluate overbought or oversold conditions in the price of a stoông chồng or other asphối. Originally developed by noted American technical analyst J. Welles Wilder Jr., who introduced the concept in his seminal 1978 book,"New Concepts in Technical Trading Systems," the RSI is displayed as an oscillator, which is a line graph that moves between two extremes. Its reading can range from 0 khổng lồ 100.


The primary trend of the stock or assetis an important tool used khổng lồ ensure that the indicator"s readings are properly understood. Well-known market technician Constance Brown has widely promoted the idea that an oversold reading on the RSI that occurs in an uptrover is likely much higher than 30%, và an overbought reading on the RSI that occurs during a downtrover is much lower than 70%.


Traditional interpretation và usage of the RSI dictates that values of 70 or above suggest that a security is becoming overbought orovervaluedand may be primed for a trendreversalor corrective pricepullback. An RSI reading of 30 or below indicates an oversold or undervalued condition.


In finance, the Relative sầu Strength Index (RSI) is a type of momentum indicator that looks at the pace of recent price changes so as khổng lồ determine whether a stock is ripe for a rally or a selloff.The RSI is used by market statisticians & traders, in addition to other technical indicators as a means of identifying opportunities khổng lồ enter or exit a position.Generally, when the RSI surpasses the horizontal 30 reference cấp độ, it is a bullish sign and when it slides below the horizontal 70 reference cấp độ, it is a bearish sign.

Overbought và Oversold Levels

In terms of market analysis và trading signals, when the RSI moves above the horizontal 30 reference level, it is viewed as a bullish indicator.


Conversely, an RSI that dips below the horizontal 70 reference màn chơi is viewed as a bearish indicator. Since some assets are more volatile and move quicker than others, the values of 80 and đôi mươi are also frequently-used overbought và oversold levels.

Xem thêm: 40+ Những Câu Nói Hay Về Tiền Và Tình, 20 Câu Nói Hay Về Tiền Bạc Và Tình Yêu


*



RSI Ranges

During uptrends, the RSI tends to lớn remain more static than it does during downtrends. This makes sense because the RSI is measuring gains versus losses. In an uptrover, there will bemore gains, keeping the RSI at higher levels. In a downtrkết thúc, the RSI will tover to lớn stay at lower levels.



During an uptrkết thúc, the RSI tends to stay above 30 and should frequently hit 70. During a downtrkết thúc, it is rare lớn see the RSI exceed 70, & the indicator frequently hits 30 or under. These guidelines can help determine trover strength & spot potential reversals. For example, if the RSI isn"t able to reach 70 on a number of consecutive sầu price swings during an uptrend, but then drops below 30, the trover has weakened & could be reversing lower.


The reverse is true for a downtrkết thúc. If the downtrend is unable to lớn reach 30 or below and then rallies above 70, that downtrover has weakened và could be reversing to the upside.



Momentum Indicators: RSI vs. MACD

Like RSI,moving average convergence divergence(MACD) is atrend-following momentumindicator that shows the relationship between twomoving averagesof a security’s price. The MACD is calculated by subtracting the 26-periodexponential moving average(EMA) from the 12-period EMA. The result of that calculation is the MACD line.


A nine-day EMA of the MACD called the "signal line" is then plotted on top of the MACD line, which can function as a trigger for buy and sell signals. Traders may buy the security when the MACD crosses above its signal line and sell or short the security when the MACD crosses below the signal line.


tradequangngai.com.vn requires writers to lớn use primary sources to tư vấn their work. These include white papers, government data, original reporting, & interviews with industry experts. We also reference original retìm kiếm from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased nội dung in oureditorial policy.