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RSI (Relative Strength Index)

RSI is a momentum indicator on a 0–100 scale that compares recent gains with recent losses to show whether a stock is overbought or oversold. The Relative Strength Index, developed by J.
Contents
  1. 1.Key points
  2. 2.Formula / calculation
  3. 3.Interpretation
  4. 4.Pitfalls
  5. 5.Frequently asked questions

Key points

  • Welles Wilder, is the most widely used oscillator in technical analysis.
  • Above 70 is read as overbought (price rose fast, a pullback may follow) and below 30 as oversold (price fell fast, a bounce may follow).
  • in strong trends RSI can stay above 70 or below 30 for long periods; it is not a stand-alone buy or sell signal.

Formula / calculation

RS = Average gain (14 days) / Average loss (14 days); RSI = 100 − 100 / (1 + RS). Yatırımcı.AI computes the 14-day RSI on stock technical pages from delayed closing data.

Interpretation

It measures the speed of price movement by comparing average gains and losses over the last 14 days.

Above 70 is read as overbought (price rose fast, a pullback may follow) and below 30 as oversold (price fell fast, a bounce may follow). When price makes a new high while RSI does not, the bearish divergence signals weakening.

Pitfalls

in strong trends RSI can stay above 70 or below 30 for long periods; it is not a stand-alone buy or sell signal. Indicators mislead on thinly traded stocks. Use it with moving averages, MACD and volume.

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Frequently asked questions

RSI is a momentum indicator on a 0–100 scale that compares recent gains with recent losses to show whether a stock is overbought or oversold.

RS = Average gain (14 days) / Average loss (14 days); RSI = 100 − 100 / (1 + RS). Yatırımcı.AI computes the 14-day RSI on stock technical pages from delayed closing data.

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