Question 1

What is RSI in stocks?

Accepted Answer

RSI (Relative Strength Index) measures momentum from 0–100. Below 30 = oversold (potential bounce), above 70 = overbought (potential pullback). Whystock uses a 14-day RSI.

Question 2

How do I read MACD?

Accepted Answer

MACD compares two moving averages. When the MACD line crosses above the signal line, it suggests bullish momentum. Whystock uses the standard 12, 26, 9 settings.

Question 3

What is a P/E ratio?

Accepted Answer

P/E ratio (Price-to-Earnings) shows how much investors pay for each dollar of company earnings. A high P/E implies high growth expectations; a low P/E may indicate undervaluation or slow growth.

Question 4

How is fair value calculated?

Accepted Answer

Whystock uses a trailing P/E model adjusted for ROE: Fair P/E = 18 + (ROE × 20). Fair value = (current price ÷ trailing P/E) × fair P/E.

Question 5

What is a candlestick chart?

Accepted Answer

A candlestick chart shows four prices for each session: open, high, low, and close. A green candle means the stock closed higher; red means it closed lower. The wicks show the high and low range.

Question 6

What is the Whystock Score?

Accepted Answer

The Whystock Score (0–100) combines RSI, Sharpe ratio, and price trend vs the 200-day SMA. Higher scores suggest better risk/reward. It is not a buy/sell recommendation.

Glossary