Relative Strength Index (RSI)

A momentum oscillator developed by J. Welles Wilder Jr. in 1978 that measures the speed and magnitude of price changes on a scale from 0 to 100. Readings above 70 are traditionally considered overbought, while readings below 30 suggest oversold conditions. Traders also watch for RSI divergences -- when price makes a new high but RSI does not -- as potential reversal signals. The RSI is one of the most versatile and widely used indicators in all of technical analysis.