RSI Momentum Lab
AAPL / USD
1h
$259.52
LIVE

RSI & Momentum Framework

Indicators don't predict, they measure pressure. RSI tracks relative buying/selling strength. Momentum tracks velocity. Together they tell you if a move is exhausted or accelerating.
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1. RSI Core Signal

RSI (14) oscillates between 0 and 100. Above 50 means buyers dominate. Below 50 means sellers dominate. You are measuring pressure, not direction by itself.
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2. Overbought / Oversold Zones

Classic thresholds: • RSI > 70: overbought risk • RSI < 30: oversold risk These are warning zones, not automatic reversal triggers.
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3. Momentum Confirmation

Use momentum bars to confirm the RSI read. If RSI exits oversold and momentum flips positive, odds improve for a continuation bounce. If RSI leaves overbought and momentum flips negative, odds improve for downside follow-through.
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4. Divergence = Early Warning

Bullish divergence: price makes a lower low while RSI makes a higher low. Bearish divergence: price makes a higher high while RSI makes a lower high. Divergence warns of weakening impulse before structure breaks.
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5. Execution Lab

Switch timeframes, adjust RSI period, and inspect divergence zones. Use this stack: 1) Find RSI condition 2) Confirm with momentum direction 3) Execute only when both align with structure.
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RSI + Momentum Playbook

This filter avoids blind oscillator trades by requiring agreement between RSI state and momentum direction.

rsi_momentum_setup.py
def rsi_momentum_setup(symbol):
    # 1) Context from RSI
    rsi = get_rsi(symbol, period=14, timeframe='1H')
    mom = get_momentum(symbol, period=10, timeframe='1H')

    # 2) Long filter
    long_ready = (rsi < 35 and mom > 0) or bullish_divergence(symbol)
    if long_ready:
        return "LOOK FOR LONG TRIGGER"

    # 3) Short filter
    short_ready = (rsi > 65 and mom < 0) or bearish_divergence(symbol)
    if short_ready:
        return "LOOK FOR SHORT TRIGGER"

    return "NO TRADE (MIXED SIGNALS)"
Execution Logic
RSI

Measures relative pressure and mean-reversion risk.

Momentum

Confirms whether impulse is expanding or fading.

Divergence

Signals momentum disagreement before obvious reversals.

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