How to use RSI indicator with stocks (Relative Strength Index)
Channel: Swing Trader
Date: 2019-02-07

This video will show you what the RSI Relative Strength Index can be used to help you guess what a stock is going to do. The RSI or Relative Strength Index is one of the most, if not the most, widely used technical indicator throughout the trading world.

The RSI is a popular momentum oscillator developed in 1978. The RSI compares bullish and bearish price momentum plotted against the graph of an asset's price.
Signals are considered overbought when the indicator is above 70% and oversold when the indicator is below 30%. What Does RSI Tell You?
The primary trend of the stock or asset is an important tool in making sure the indicator's readings are properly understood.
Example Of How To Use The RSI Indicator
Divergences
A bullish divergence occurs when the RSI creates an oversold reading followed by a higher low that matches correspondingly lower lows in the price. This indicates rising bullish momentum, and a break above oversold territory could be used to trigger a new long position.
The RSI aims to indicate whether a market is considered to be overbought or oversold in relation to recent price levels. The RSI calculates average price gains and losses over a given period of time; the default time period is 14 periods with values bounded from 0 to 100.


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