THE CLASSIC FORM OF THE RELATIVE STRENGTH INDEX (RSI) AND THE CRYPTOCURRENCY EGLD

In this paper we will present the way the classical form of the relative strength index (RSI) functions on the Romanian cryptocurrency named EGLD. We will study the signals given to us by the values taken by RSI and the result obtained by us when we followed those signals. The period taken into consideration will cover the whole period since we can analyse the evolution of the price of EGLD taking into consideration the data published on the site Yahoo Finance so, the period that we will consider will be of almost three years. At the end of the paper we will present some concluding remarks about the classical forms of the technical analysis indicators and their actual capacity to give true or false signals regarding the totally new category of cryptocurrencies. The main scope of our paper is to verify if one of the most well-known and used old technical analysis indicator functions now as it should and could be used on a very young category of finance: the cryptocurrencies exemplified with the Romanian EGLD. In our research, we will analyse, at the end of it, whether higher yields can be obtained by using the RSI compared to those which result from applying the buy and hold strategy. In other studies that we will publish we will verify if other forms of the relative strength index resulted from its classical form adapted to all the information the market currently offers function better. The actual study empirically tests the RSI and the buy and hold strategy on the same set of data.