The Relative Strength Index (RSI) is a popular technical analysis tool used to measure the speed and change of price movements in financial markets. It ranges from 0 to 100 and helps traders identify whether an asset, like a stock or cryptocurrency, is overbought or oversold. Typically, an RSI above 70 indicates that an asset may be overbought, while an RSI below 30 suggests it may be oversold.
Traders often use the RSI in conjunction with other indicators to make informed decisions. For example, combining the RSI with moving averages can provide a clearer picture of market trends and potential entry or exit points for investments in assets like stocks or forex.