Relative Strength Index

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The Relative Strength Index or RSI is calculated with the following formula, where RS = Average Gain / Average Loss. 14 periods is generally used to calculate RSI[1] but other periods may used, as long as the period is consistent throughout the calculation. The concept of Relative Strength Index is credited to J. Welles Wilder[2].


Average Gain = (SUM of the Total Gains for the preceding 14 periods)/ 14

Average Loss (|SUM of the Total Losses for the preceding 14 periods |) / 14


RS=Average Gain / Average Loss


RSI = 100 - ( 100 / 1 + RS ) [2]

References

  1. Relative Strength Index. Stockcharts.com.
  2. 2.0 2.1 Relative Strength Index. Trade2Win.com.