Relative Momentum Index

What is the Relative Momentum Index?

The Relative Momentum Index is Roger Altman's 1993 modification of RSI. Where RSI measures each up or down change from one close to the next, RMI measures the change against the close a set number of bars back (the momentum step), then applies the same Wilder-style smoothing and 0-100 scaling. With the momentum step set to 1, RMI is identical to RSI; with a step of several bars, each reading captures multi-bar momentum rather than single-bar noise.

The practical effect is a smoother oscillator that swings more decisively between extremes. Multi-bar changes tend to be larger and more persistent than bar-to-bar changes, so RMI spends more time in its overbought and oversold zones and crosses thresholds with fewer whipsaws, at the cost of added lag. There is no single standard setting: published examples pair a longer smoothing length with a momentum step of several bars, and platform defaults vary.

How traders use it

• For overbought/oversold timing with RSI-style thresholds. The smoother line tags extreme zones more decisively, though an extreme reading is a condition to watch, not a reversal signal by itself.
• For divergence: the same regular bullish and bearish divergence reads used on RSI apply, with RMI's multi-bar basis filtering out some of the minor swings that clutter RSI divergence.
• As a drop-in replacement for RSI inside existing rules when single-bar noise causes too many threshold whipsaws; the substitution changes signal frequency, so thresholds usually need retuning.