# Momentum Principle The momentum principle suggests that assets that have been rising in price are likely to continue rising, and those that have been falling are likely to continue falling. The RSI leverages this principle by comparing the magnitude of recent gains to recent losses: • **Gains** indicate upward momentum. • **Losses** indicate downward momentum. By calculating the average gain and average loss over a specified period, the RSI provides a measure of the balance between upward and downward momentum.