Introduced by J. Welles Wilder, RSI is a momentum indicator that calculates the rate of change of price movements. RSI trades between 0 to 100. RSI indicator is overbought when it moves above 70 and oversold when it moves below 30. RSI signal can be obtained by looking for divergence, swing failed and centerline crossover. For example, a book written by Constance Brown, entitled Technical Analysis for the Trading Professional, this book discusses the concept of bull and bear market range for RSI. Andrew Cardwell were introduced about the negative and positive RSI reversal indicator. New Concepts in Technical Trading Systems, written by Wilder in 1978. It also talks about the parabolic SAR, ATR indicator and ADX indicators. Although the indicators were developed before the era of computers, Wilder's indicators up to become popular indicators in the world.
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