RSI

From Reuters Financial Glossary

Synonym: Relative Strength Index

A technical analysis tool that compares the average strength of price rises for a given instrument with the average strength of price falls over a certain number of days. It does not compare the relative strength of two securities but the internal strength of the price moves of a single instrument. It is used to identify overbought and oversold signals as well as to act as a warning when divergence exists between the direction of the index and the direction of the instrument's price. For example, the RSI may be rising when the price of the instrument is falling, which gives a buy signal.

See also: Momentum, Technical Analysis