Let's talk about momentum and the concept of bull & bear ranges.
1/x
1/x
Ranges can be defined as the RSI spending more time around the 60 or 40 levels. 2/x
In bull markets, momentum stays elevated, and we rarely see an RSI under 40 for very long if at all. In bear markets, RSI struggles to reach 60. 3/x
In the GFC RSI spent all of 2008 below 60 as it did in 2001-2002. From 2009 until 2015 we rarely saw RSI spend much time near 60. 4/x
Since the peak in 2022, the weekly RSI has dropped under 60 about 5 times and hasn't risen above 58 since the first weeks of Jan. '22. 5/x
Identifying the range momentum is in can be a useful tool in identifying the type of market regimen the index is in. 6/6
The concept or ranges for an indicator is more art than science and of course has some subjectivity to it.
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