RSI, or Relative Strength Index, is a popular indicator used in trading to assess whether an asset is overbought or oversold. It ranges from 0 to 100, with values above 70 typically indicating that an asset may be overbought and values below 30 suggesting it might be oversold.Traders calculate RSI by comparing the magnitude of recent gains to recent losses over a specified period, usually 14 days. This helps identify potential price reversals, enabling traders to make informed decisions about entering or exiting trades.When the RSI shows an overbought signal, traders might consider selling or shorting the asset, expecting a decline. Conversely, if the RSI indicates an oversold condition, they may look for buying opportunities, anticipating a price increase.Overall, the RSI is a valuable tool for traders seeking to gauge market momentum and timing their trades more effectively. However, like any indicator, it works best when used in conjunction with other analysis methods to confirm trends and signals.