Overbought = bullish or bearish?
Here's the real answer: depends on the timeframe and liquidity flow.
Short-term? Overbought signals often mean local tops, especially on lower timeframes. Degen scalpers fade these.
But in a macro bull run with strong narrative? Overbought can stay overbought for WEEKS. $BTC in 2021 was "overbought" for months straight.
The real alpha: check funding rates + open interest. If funding is neutral-to-negative while price is overbought, that's your signal for continuation. If funding is sky-high, expect a flush.
Don't trade RSI in a vacuum. Context is everything.
Here's the real answer: depends on the timeframe and liquidity flow.
Short-term? Overbought signals often mean local tops, especially on lower timeframes. Degen scalpers fade these.
But in a macro bull run with strong narrative? Overbought can stay overbought for WEEKS. $BTC in 2021 was "overbought" for months straight.
The real alpha: check funding rates + open interest. If funding is neutral-to-negative while price is overbought, that's your signal for continuation. If funding is sky-high, expect a flush.
Don't trade RSI in a vacuum. Context is everything.