Technical analysis · updated October 21, 2026
What is RSI (relative strength index) and how is it calculated
RSI compares the size of the gains with the size of the losses over the last 14 trading days and gives a number between 0 and 100. Above 70 says the price has risen very fast; below 30, that it has fallen very fast.
RSI formula
RS = average gain over 14 days ÷ average loss over 14 days
- Average gain
- The average size of the up days over the last 14 days.
- Average loss
- The average size of the down days, taken as a positive number.
Worked example
Over the last 14 days, the up days averaged +1.2% and the down days −0.6%.
Close to 70: the price has risen fast, but is not yet in "overbought" territory.
How to read RSI
In a strong trend, RSI can stay above 70 or below 30 for weeks. That does not automatically mean the price will turn.
When RSI can fool you
Not a sell signal: very good stocks often reach an RSI above 70 and keep rising.
Related terms
Questions about RSI
What does an RSI of 30 mean?
That the price has fallen a lot and fast over the last two weeks. Some investors see it as an opportunity, but the fall can continue.
These explanations are for information only. They are not a recommendation to buy or sell.
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