Rsi
by greencat
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The RSI ranges from 0 to 100, but a stock is considered overbought if it reaches the 70 level, meaning that you should consider selling. When it is a true bull market, an RSI of 80 might be a better level since stocks often trade at higher valuations. Likewise, if the RSI approaches 30, it is a strong buying indicator (20 in a strong bear market).
The RSI is a big tool in momentum trading. The RSI can help you make some serious money, but be forewarned, it isn't a decision maker. Big surges and drops in stocks will effect the RSI, but it could just be a false buy or sell. The RSI is best used as a valuable compliment to your other stock picking tools.
greencat:notes
When looking at the RSI I want to see if the chart has a history of moving up when it hits a certain level and falling when to high. Some charts are a predictable buy their RSI history patterns bottom and peak on a regular basis.
NEVER USE USE THE RSI AS YOUR ONLY INDICATOR.