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Random article: Relative Strength Index
Wilder recommended application of RSI measured for 14 days, but also periods for 9 and 25 days are often mentioned. This index is calculated based on relation of average value of positive growth of close price of bar (in relation to close price of previous bar) to total amount of price increment. At the period of 14 days the index expresses an average value of all positive increments in price, then – it shows an average value of all negative increments. Essentially, RSI is exactly the relation between average value of positive growth of close price to the sum of average values of positive and negative increments. RSI fluctuates within the range from 0 to 100, because average value of the index is multiplied to 100. The shorter applied period for this indicator is, the more sensitive towards price fluctuations it gets.
This economic index is measured for wages and unemployment benefits in the USA. It can tell about occurrence of inflation processes in the state economy. FRS closely watches this indicator and based on its value adjusts its financial policy, which confirms its high significance. The Index is published quarterly, at 20-s, at 08:30 a.m EST (New York). Published data is used for middle- and long-term forecast. Rise in index in the period of expectations of growing major interest rates leads to consolidation of national currency.
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