1. Relative strength index (RSI) is an important tool for finding a profitable trade set up. However experts are divided on the values anfd the values being given are to be used as the same have been tested manually and have provided remarkable results. Thus one can say that 7 day RSI is an effective tool for finding the direction of a market or a particular stock.

2. When weekly trend is up and RSI moves above 40; it shows that purchase can be made and if RSI values breaks the level of 60 on to the lower side, than it means that decline is in offing. However one must use this tool in conjunction with other technical analysis tools available for determining the trend in the market to get more accurate results.

7 day RSI Values
3. Thus as a thumb rule one can enter in a stock when the RSI value moves above 40 level an can exit the stock if RSI value falls below 60 level. More risk prone takers can use RSI value of 30 to buy and RSI value of 70 to sell which makes the entry a high risk highreward category.

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