Relative Strength Index (RSI)

RSI is basically the indicator that tells us the momentum or strength of a market movement. Below is a formula for calculating RSI.



Such an indicator indicator
Otherwise, all calculations will be made by the graph program automatically.
RS = average number of days close "with profit / average number of days close" with loss.
RSI has a reading of 0 - 100. A trend is always considered "overbought" by traders when the RSI reads upwards 70, and "oversold" when RSI shows 30 down.



Since RSI is a lagging indicator, it also has a weakness
alone. The strong and strong market movements can have a strong impact on RSI and it may give a "false" signal.

 

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The weakness of RSI :
From the emerging RSI signal, the price / trend will continue to move upwards, but if at that moment the trader immediately opens a position based on this sell signal, the trader will be stuck in the trading that will continue to lose