Relative Strength Index (RSI)

The RSI, introduced by J. Welles Wilder in his 1978 book “New Concepts in Technical Trading Systems,” has remained a timeless and widely used indicator among traders.

Wilder designed the RSI to serve as a momentum oscillator capable of being a universal measure across commodities, smooth erratic price moves, and identify price extremes.

The RSI functions by measuring the average of the gains and losses over a specified period to determine the relative strength of an asset. It ranges between 0 and 100, where values below 30 represent an extreme low and above 70 represent an extreme high.