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RSI- Relative strength index is technical indicator which indicates the momentum of price movement and whether the Ā stock is over sold or over bought. The index spreads from 0 to 100, if the rsi moves above 70 the stock shows strength as it is over bought and if falls below the 70 line then it indicates bearish trend reversal as it is overvalued. If the rsi move below 30 line then the stock shows weaknesses as it is oversold and if the rsi rise above 30 line it indicates bullish trend reversal as it is undervalued.
BUY- when the RSI moves above 30.
SELL- when the price falls below 70.
RSI is best used in non trending zones.
RSI: Relative strength index, RSI is used at non-trending zone
1. RSI>70 = Ā Over brought – trend is expected to be negative.
2 RSI<30 = Over sold- trend is expected to be positive.
Buy- When RSI moves above 30
Sell-When RSI falls below 70
RSI (leading indicator/Non Tredning indicator)
I open the price chart and apply the RSI (for short term use 21days).
I can see the RSI curve in the scale of 0-100.RSI > 70 ā>indicates strong supply zone (lot of buying is happening).
But if it crosses below 70 markā>overbought (no more buying)ā>i should sell.
The trend is expected to be -ve.RSI < 30 ā>indicates weak buyers zone (lot of selling is happening).
But if it crosses above 30 markā>oversold (no more seeling)ā>i should buy.
The trend is expected to be +ve.RSI (Relative Strength Indicator),is another technical indicator which is used at non-trending areaĀ .
When RSI >70, it indicates theĀ strength of buyers
When RSI<30, it indicates theĀ strength of sellers
Relative strength index ā RSI
It provides the market trend and a range of 30 to 70% to indicate buying and selling zone, i.e over bought and over sold stocks.
Buying zone is considered to be below 30%of RSI region where the stocks are oversold. When price crosses and goes above 30% then it is ideal to buy
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