What is RSI in Forex Trading?
RSI
Forex Trading Glossary
Quick Answer: RSI (Relative Strength Index) is a momentum indicator measuring overbought/oversold conditions on a 0-100 scale. Above 70 is overbought, below 30 is oversold.
What is the Relative Strength Index (RSI)?
The RSI is a momentum oscillator that measures the speed of price movements on a scale from 0 to 100. Traditionally, readings above 70 signal overbought conditions and below 30 signal oversold conditions.
RSI in Practice
- Divergence: RSI failing to confirm price highs/lows can warn of reversals.
- Trend filters: Adjust thresholds (e.g., 40-80 in uptrends).
- Multiple timeframes: Align lower timeframe signals with higher timeframe trends.
- Beware of strong trends: RSI can remain overbought or oversold for extended periods.
Related Terms
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