VideoCharts7 min read
What the RSI indicator actually tells you (and what it doesn't)
RSI measures how stretched a recent move is on a 0 to 100 scale. It is useful for timing, useless for prediction, and misread by most beginners.
Technical analysis
RSIshare overbought hai ya oversold, 0 se 100 ka meter
Relative Strength Index: a momentum oscillator from 0 to 100 comparing recent gains with recent losses; above 70 is called overbought, below 30 oversold.
RSI, the Relative Strength Index, measures the speed of recent price changes on a scale from 0 to 100, usually over 14 periods. Readings above 70 are labelled overbought and below 30 oversold. The labels mislead beginners, because in a strong uptrend RSI can stay above 70 for weeks while price keeps rising, and selling because RSI is high means fighting the trend. Suppose SBI rallies from ₹740 to ₹820 and RSI reads 78; that describes strong momentum, not an automatic reversal. RSI is more useful for divergence: if price makes a new high but RSI makes a lower high, buying momentum is fading. It also helps identify pullbacks within a trend, such as RSI dipping to 40 in an uptrend. Use RSI to describe momentum, then confirm with price structure and volume before acting.
Related terms
Lessons that use this term
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Candlestick patterns for beginners: the five worth learning first
A candle is four prices drawn as one shape. Learn to read the shape first, then five patterns that only mean something at the right place on the chart.
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Support and resistance: how to find the levels that matter
Support and resistance are the prices where the market has changed its mind before. Here is how to find the ones worth marking and how to use them with a stop.