The Relative Strength Index (RSI) is a momentum indicator used in technical analysis.
It ranges from 0 to 100.
🔹 RSI above 70 is traditionally considered overbought. 🔹 RSI below 30 is traditionally considered oversold. 🔹 RSI can remain elevated or depressed during strong trends.
Important: Overbought doesn’t automatically mean sell, and oversold doesn’t automatically mean buy.
Always consider market structure and other indicators.
Liquidity describes how easily an asset can be bought or sold without significantly changing its price.
High liquidity generally means: 🔹 More active buyers and sellers. 🔹 Easier trade execution. 🔹 Potentially smaller differences between buying and selling prices.
Low-liquidity tokens can experience larger price swings and greater slippage.
Before trading a cryptocurrency, check its trading volume and market depth.