Are RSI overbought and oversold signals actually reliable? The truth is something you only learn after getting burned by this indicator 🤔
Simply put, RSI is like the market’s “thermometer,” bouncing around between 0 and 100. Above 70 is considered overbought, and below 30 is considered oversold. Sounds pretty scientific, right?
But the thing is, sometimes the market can keep running hotter even when it’s already feverish, and sometimes it can freeze even harder when it’s already icy. Just look at this 5.42% rally in $AIOT : RSI had already gone over 70, but it kept climbing.
I’m done! Overbought ≠ an immediate drop, and oversold ≠ an immediate rise. RSI is most useful for helping you gauge when “sentiment is overheated,” not for giving you direct buy or sell signals. It’s like when it’s unbearably hot in summer—it doesn’t mean it’s about to rain, just that the weather might change.
A common beginner mistake: seeing RSI go overbought and rushing to short, or seeing it go oversold and rushing to go long. More often than not, those damn whales end up smacking you around in both directions.
Remember: use RSI alongside the trend—go with the larger trend and against the smaller one. Overbought and oversold readings are more useful in a sideways market, but can easily fail in a strong one-way trend.
$AIOT #永续合约 #Web3 #Cryptocurrency
Simply put, RSI is like the market’s “thermometer,” bouncing around between 0 and 100. Above 70 is considered overbought, and below 30 is considered oversold. Sounds pretty scientific, right?
But the thing is, sometimes the market can keep running hotter even when it’s already feverish, and sometimes it can freeze even harder when it’s already icy. Just look at this 5.42% rally in $AIOT : RSI had already gone over 70, but it kept climbing.
I’m done! Overbought ≠ an immediate drop, and oversold ≠ an immediate rise. RSI is most useful for helping you gauge when “sentiment is overheated,” not for giving you direct buy or sell signals. It’s like when it’s unbearably hot in summer—it doesn’t mean it’s about to rain, just that the weather might change.
A common beginner mistake: seeing RSI go overbought and rushing to short, or seeing it go oversold and rushing to go long. More often than not, those damn whales end up smacking you around in both directions.
Remember: use RSI alongside the trend—go with the larger trend and against the smaller one. Overbought and oversold readings are more useful in a sideways market, but can easily fail in a strong one-way trend.
$AIOT #永续合约 #Web3 #Cryptocurrency