Trader's Glossary

RSIRelative Strength Index

A 0–100 momentum oscillator. Default settings flag >70 as overbought, <30 as oversold. Best used with confluence.

The Relative Strength Index (RSI) is a 0–100 momentum oscillator that measures the magnitude of recent gains vs. losses over a default 14-period window. >70 = overbought (sellers may step in). <30 = oversold (buyers may step in).

RSI alone is noisy and produces too many fake signals. Pair it with price action: an RSI reading of 28 PLUS price tagging the lower Bollinger Band PLUS a bullish reversal candle = high-probability long. RSI divergence (price makes new low, RSI doesn't) is another reliable confluence factor.

Strategies that use RSI

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