Japanese Candlesticks for Identifying Opportunities

📊 Relative Strength Index (RSI) A Simple Market Reading

Have you heard about the RSI indicator and want to understand it quickly? Follow this simplified explanation to learn how to read it and use it with Japanese candlesticks to enhance your trading decisions.

1. What is RSI? 🤔

Short for Relative Strength Index.

A number ranging between 0 and 100 that measures the strength and dynamics of price movement.

2. Basic Levels 🧭

Above 70 → Overbought Area

Below 30 → Oversold Area

3. How to Read It Practically? 🔍

1. Open the time frame (Hourly, 4-Hour, Daily).

2. Set RSI to the default setting (14 periods).

3. Watch if the indicator line crosses above 70 or drops below 30.

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4. Combine RSI with Japanese Candlesticks 🕯️

Example:

We found a Hammer candlestick at a support level, and the RSI appeared below 30.

This is a strong buy signal convergence: Reversal candle + Oversold indicator → Entry opportunity.

5. Smart Tips 💡

Do not rely on RSI alone: Combine it with a candlestick pattern or moving average.

Set a stop loss: below the point where the green light appeared.

Try it on a demo account before using it with real funds.

✨ Try these steps and share with us:

Where did you last see the RSI close to 30 or 70?