Welles Wilder's RSI

R5: Yellow line
R14: Orange line
OB: White dotted horizontal line (every bar)
ML: White dotted horizontal line (every other bar)
OS: White dotted horizontal line (every bar)

R5: Yellow line (RSI(5))
R14: Orange line (RSI(14))
OB: White dotted line (overbought level set to 70)
ML: White dotted line (midpoint level set to 50)
OS: White dotted line (oversold level set to 30)

Welles Wilder's RSI (short for Relative Strength Index) was formidable in its day. It's formula produces output in a range from 0 to 100. The benefit of this is that changes in volatility do not affect the amplitude of this indicator and in principle make it easier to read.

This indicator is a Phase Lag Indicator. One benefit of this is that a look back over 10 bars irons out small market oscillations but also means it is not very responsive to market turns.

The RSI has overbought (OB) and oversold (OS) levels. The RSI was designed to sell RSI downturns when above the overbought level and to buy RSI upturns when below the oversold level. WARNING: in today's markets this strategy will lose money over time.

Some traders started to use two RSI formulae, the most popular being RSI(5) meaning RSI formula with 5 bar look back and RSI (14) to help to eliminate being falsely triggered into (or out of) a market position.

RSI is familiar benchmark for many traders so it is included on this site.

In a strong upmove the indicator tends to 100. In a strong downmove the indicator tends to 0. This is called saturation. Neither 0 values nor 100 values suggest the move is about to end. Instead one should look for exhaustion patterns.