Learn the terms · Longer read
What RSI measures, and what it does not
A gauge from 0 to 100 of how fast a price has been rising or falling over the last 14 trading days. Below 30 is called "oversold"; above 70, "overbought". Both describe recent movement, not what comes next.
What it measures
RSI - the Relative Strength Index - compares the size of a stock's recent up-days with the size of its recent down-days. Trendentum uses the standard 14-day window. If almost every one of the last fourteen sessions closed higher, RSI sits near 100; if almost every one closed lower, it sits near 0. Most of the time it wanders between 40 and 60, which is a price moving in an ordinary way.
The number is a rate, not a level. A stock can be at an all-time high with an RSI of 55, because it got there slowly. Another can be well below its highs with an RSI of 78, because it bounced hard in a fortnight. RSI knows nothing about value, earnings or the company; it reads speed off the price alone.
How to read 30 and 70
The two thresholds are conventions, and Trendentum's methodology page states the exact values the chart figure uses. Below 30 the price has fallen fast enough that chart-watchers call it "oversold" - the fall has been steep relative to any rises. Above 70 they call it "overbought" - the rise has been steep relative to any falls. Neither word is a judgement about whether the move was deserved.
What the labels have historically meant is narrower than they sound. A very low RSI says the recent selling has been intense; it does not say the selling is finished. Prices that fall fast can keep falling, and a stock in a strong downtrend can sit under 30 for weeks. The same holds in reverse above 70. That is one reason RSI no longer votes on Trendentum's outlook. Since 8 October 2026 it is a chart figure with no vote: it describes the recent price, and the backtester does not score it.
What it is not
RSI is not a forecast, a target or a signal to act. It is arithmetic over the last fourteen closes, and it will say the same thing about a company announcing record profits as about one in trouble if their prices moved the same way. It also tells you nothing about how far a move might run; two stocks with an RSI of 25 can have fallen 4% and 40%.
It is also worth knowing what it does well: it puts the speed of a move on a common scale, so a quiet utility and a volatile miner can be read side by side. That is the reason it survives on every charting platform after fifty years - not because the thresholds predict anything.
An example
Suppose a stock closes lower on eleven of fourteen days and the falls are larger than the three rises. RSI drops to about 24, and the stock's chart figures read "RSI (14-day): 24.0 - oversold". Two weeks later the price has steadied, the mix of up and down days is even, and RSI is back near 50 - the figure now reads neutral, although the price is no higher than it was. The outlook did not move on either day, because RSI is not one of its readings. That is the indicator doing its job: it reported speed, and the speed went away.
Where you’ll see it on Trendentum
- Each stock's "Chart figures (no vote)" - the RSI value and whether it is below 30, above 70 or in between
- The price chart on each stock page, where RSI is drawn
- The methodology page, where the exact period and thresholds live
Every term on this page is used the same way across the app, and the exact settings behind each chart figure are on the methodology page. Trendentum explains every call and never tells you what to do with it.