WY-06-25 / 05
Relative Strength Analysis Versus the RSI Indicator
Decisions, Execution & Validation
Lesson / WY-06-25
The relative strength ratio is often abbreviated RS, and the Relative Strength Index is abbreviated RSI. Their names are similar, but their data and purposes differ. RS compares an instrument with an external benchmark to answer which performs more strongly. RSI uses only one instrument's price advances and declines over a specified period, smoothing and normalizing them into a bounded momentum indicator that measures recent upward force relative to downward force.
Course content is for learning and research only. It is not investment advice.
Read the Chapter ↗Timestamps
7 lessons · Chapter contents
01Purpose and Comparison Universe of Relative Strength Analysis↗02Comparing an Instrument with the Overall Market, Industry, or a Suitable Benchmark↗03Relative Performance During Advances and Pullbacks↗04Relative Strength Ratios and Swing Comparisons↗05Relative Strength Analysis Versus the RSI Indicator↗06Joint Screening of Relative Performance, Structural Location, and Potential Risk↗07From Initial Screening to Trade Execution↗Observe the market: start with context and place price within its structure.
Understand structure: compare supply and demand, and let evidence support or revise your hypothesis.
Form a view: define risk limits and know when to reassess.
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Point-and-Figure Charts and Price Target Estimation
The Nine Buying and Selling Tests and Trading Scenarios
