RSI can be used in several ways to make better business decisions:
Identifying Overbought and Oversold Conditions: When RSI is above 70, the asset is considered overbought and may be due for a price correction. When RSI is below 30, the asset is considered oversold, and there might be a potential for a price increase. Divergences: RSI can also be used to spot divergences, which occur when the price of an asset moves in the opposite direction of the RSI. This can indicate a potential reversal in price trend. Trend Confirmation: A rising RSI indicates a strengthening trend, while a falling RSI suggests a weakening trend. This can be useful for confirming the direction of a trend before making investment decisions.