RELATIVE INDICATORS INDEX Strenght

RELATIVE INDICATORS INDEX Strenght

RSI (Relative Strength Index)

Was first introduced by J. Welles Wilder in 1978 in his book New Concepts in Technical Trading Systems. The value of the RSI is in the range of 0-100 (therefore classed indicators oscillators. Oscillate = range). RSI itself is a momentum indicator that compares the prices between the current value of the losses that occur appeal. RSI mathematically written as follows:

with RS are:

RS = Relative Strength, is the ratio between the two smoothed XMA
AG = Average price gain in the period specified. Retrieved from the period divided by the total gain is used.
AL = Average price loss in the period specified. Retrieved from total loss divided by the period that is used

how to read a simple indicator RSI is at 50 points of his, when RSI leaves 50 points and leads the point 75, it can be indicated prices are rising and will usually come back down after the close or until point 75, often referred to in the overbought condition (see picture), and conversely, if the RSI left point 50 and point 25 lead prices are down and usually will go up after the close with a point 25 is often referred to in the oversold condition. (see picture)

RSI apart to determine overbought / oversold can also help us to know: Divergence positive / negative and momentum of price movements.

This setting is only suitable for the pairs AT JUST CLICK HERE