WickCheck / Trading school / RSI
RSIRelative Strength IndexBeginner
A 0–100 oscillator that compares recent gains with recent losses.
What it means
Readings above 70 are called overbought and below 30 oversold. Very short RSI settings (2 or 3) are used in mean-reversion strategies on indices; longer ones for divergence.
How to spot it
- RSI(14) above 70 or below 30, or diverging from price.
Common mistakes
- Shorting just because RSI is above 70 in a strong trend.
Related terms
Moving averageThe average closing price over the last N candles, drawn as a line.…MACDThe gap between a fast and a slow EMA, with a signal line and histogram.…DivergencePrice makes a new high or low but an oscillator does not.…
Why most strategies need a human behind the screen
Read the lessonWhat a mechanical test can and cannot tell you about smart money concepts.
Education only, not financial advice. Definitions vary between teachers; these are ours, written for clarity.