WHAT is RSI Understanding RSI: A Simple Guide 📊

The Relative Strength Index (RSI) is like a speedometer for price strength, measuring market momentum on a 0-100 scale.

How RSI Works:

A. Track Price Movement: Analyze green candles (gains) and red candles (losses) to gauge market direction.

B. RSI Calculation: Compares the last 14 days' upward and downward strength.

C. Signal Generation: RSI indicates if the market is overextended in one direction.

Using RSI to Your Advantage:

- Buy Signal: RSI below 30 (oversold zone) may indicate a potential buy zone.

- Sell Signal: RSI above 70 (overbought zone) may indicate a potential sell zone.

- Divergence Strategy: Look for discrepancies between price movement and RSI signals, which can indicate potential reversals.

Real-World Example:

If solana price is falling and RSI drops to 20.to 30 suggesting extreme sell pressure, you could:

1. Enter a long position at RSI 20.

2. Set a stop-loss below support.

3. Exit the trade at RSI 65-68# but you can reach well then enter to trade ready #SOPH