Right why to use Rsi indicator in future market
The relative strength index (RSI) is a technical indicator that is commonly used to measure the strength of a security's price action. It is a momentum indicator that calculates the speed and change of price movements. The RSI can be used in the futures market to help traders identify potential overbought and oversold conditions, as well as to spot trend reversal points.
To use the RSI in the futures market, you can plot the indicator on your chart and look for divergences between the RSI and the underlying security's price action. A bullish divergence occurs when the security's price is making new lows, but the RSI is making higher lows. This can be a sign that the security's downward momentum is slowing and that a trend reversal may be imminent. Similarly, a bearish divergence occurs when the security's price is making new highs, but the RSI is making lower highs. This can be a sign that the security's upward momentum is slowing and that a trend reversal may be imminent.
It's important to note that the RSI should not be used as a standalone indicator and should be used in conjunction with other technical analysis tools.