What is Relative Strength

English · 2:53 · Published 2026-10-28

Why some stocks lead the market, the RS line and the 1–99 RS rating.

What the video says

Some stocks rise with the market. A few rise much faster. And some keep climbing even when the market falls. The difference between them has a name: Relative Strength.

Relative strength simply asks one question. Is this stock doing better than the market, or worse?

Here is a simple example. Over one year, the Nifty 500 goes up ten percent.

Stock A goes up thirty percent. It beat the market by a wide margin.

Stock B goes up only two percent. It made money, but it fell behind the market.

Both went up. But only one of them was a leader. Relative strength is how you tell them apart.

To see this on a chart, we draw the RS line. It is the stock's price divided by the index. Nothing more.

When the RS line rises, the stock is beating the market. When it falls, the stock is lagging. When it is flat, the stock is just moving with the market.

Here is the most useful part. When the market falls, watch which stocks fall the least. Their RS line keeps rising, even on red days.

These are often the first stocks to break out when the market recovers. Big buyers were holding them through the weakness.

Another early clue: the RS line makes a new high before the price does. It tells you the stock is already leading, quietly.

Now, comparing every stock with the index one by one is slow. So we rank them. The RS rating scores every stock from one to ninety nine.

A rating of ninety means the stock has done better than ninety percent of all stocks. Recent months count more than older months, so the rating reacts to fresh strength.

Leaders usually sit above eighty. Laggards sit below thirty. Most of the big winners in any rally start with a high rating.

On Market Strength, every chart in Workspace has the RS line right below the price, and the list is ranked by RS rating.

In the Stock Screener, add an RS rating filter, and you see only the leaders, in seconds.

Relative strength does not tell you when to buy. It tells you where to look.

Market Strength is an education and research tool, not investment advice.

Read the guide: What is relative strength? A swing trader’s guide with real charts

More videos

All video lessons