Make a note: $W has a daily RSI of 87.8, which is in overbought territory.
People often ask what RSI means. This is how I understand it.
The 14 in RSI means 14 candlesticks: on a 4-hour chart, that corresponds to just over two days (56 hours); on a daily chart, it’s exactly two weeks.
“Divergence” is a common way of interpreting RSI: when the price makes a new high but RSI doesn’t, it’s often seen as a sign that upward momentum is weakening. But divergence can also persist for several occurrences.
Indicators can fail, so risk management should never be neglected: deciding in advance what to do if you’re wrong matters more than guessing correctly.
#W
People often ask what RSI means. This is how I understand it.
The 14 in RSI means 14 candlesticks: on a 4-hour chart, that corresponds to just over two days (56 hours); on a daily chart, it’s exactly two weeks.
“Divergence” is a common way of interpreting RSI: when the price makes a new high but RSI doesn’t, it’s often seen as a sign that upward momentum is weakening. But divergence can also persist for several occurrences.
Indicators can fail, so risk management should never be neglected: deciding in advance what to do if you’re wrong matters more than guessing correctly.
#W