Identify market extremes using the Relative Strength Index. Spot overbought and oversold conditions for potential reversal trades.
BTCUSDT
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NEUTRAL
ETHUSDT
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NEUTRAL
The Relative Strength Index (RSI) measures the speed and magnitude of price changes. It oscillates between 0 and 100.
Asset may be undervalued. Potential for price bounce or trend reversal to the upside.
Asset may be overvalued. Potential for price pullback or trend reversal to the downside.
Do not front-run the level. Wait for RSI to clearly cross 70 or 30.
Ideally, volume should be decreasing on the push into the zone, suggesting momentum exhaustion.
Take profit when RSI returns to 50 (Neutral).
In strong trending markets, RSI can stay overbought/oversold for extended periods. Do not fade strong trends blindly.