 The relative strength ratio, RSI, is used for measuring whether a stock is overbought or oversold. Generally, when the RSI is greater than 70 on a daily chart, it is overbought, and the price drop is likely to happen soon. When the RSI is less than 30, the stock is generally oversold. To optimize your buy and sell triggers, you might have to use RSI values that are slightly different from 30 and 70, depending on which stock you are trading. It is also helpful to look at how the stock has been performing historically. For example, Google rarely hit the RSI value of 70 in the last year, but AMC went as high as 79 at least twice for the last year. Aside from looking at RSI on a daily chart, it's also helpful to look at RSI on a weekly chart to make your buy or sell decisions.