FOREX RSI
The RSI (Relative Strength Index) attempts to find the strength of the current trend and can be used in a number of ways on the forex charts. The most popular period for the RSI is 14.
The RSI can be used to find selling/short positions when it crosses above 70 because the forex symbol will be considered overbought. Buying/long positions are found on the forex chart when it crosses below 30 and therefore considered oversold.
Support and resistance occurs on the RSI just as it may appear on the forex chart.
Divergence occurs when the forex symbol makes a new high or low while the RSI does not. This would indicate a weak position and can be expected to correct in the opposite direction.
Divergance on the forex chart may also occur when the RSI begins to make a new high or low and the price does not. This should correct itself as the forex symbol will often follow the RSI up or down.