Technicals
Wilder's RSI is a technical indicator developed by J. Welles Wilder Jr. and compares a stock's gains to its losses over a specific time period. This is different than a basic RSI, which compares a stock against an index. Wilder's compares the stock to itself.
Wilder's RSI can act as an indicator to reveal the potential for an upcoming reaction or reversal, bring out patterns that might be difficult to discern on a price chart, show bearish or bullish divergence that could signal a trend reversal, and establish important levels of support and resistance.
When Wilder's RSI reaches the 70 percent level, it indicates the stock may be overbought and could be ready to see a price reduction. When it reaches the 30 percent level, it indicates the stock may be oversold and could be ready to see a price increase.
Wilders info by BetterTrades Charts
Wilder's RSI is considered a very useful indicator that can be extremely helpful in stocks that are trading in channels. It doesn't fare as well with trending stocks. Like most indicators, no decision to enter or exit a trade should be based solely on Wilder's RSI. It can be an important part of a trader's toolbox, but shouldn't be the only indicator consulted before making a decision.
