โก INJ is up 12.15% and RSI is screaming overbought at 75.5. So why am I still looking at longs?
Because sometimes overbought stays overbought. The trend is that strong.
๐ The Setup:
โข Price: $6.406 โ massively above SMA25 (4H: $5.469, Daily: $5.035)
โข RSI 4H: 75.5 (overbought) | Daily: 72.5 (overbought)
โข MACD: Strong bullish momentum on both timeframes
โข Volume: $33.2M at 1.64x ratio โ solid participation
โข L/S Ratio: 1.69 โ longs are heavily positioned
โข SMA99 Daily: $4.983 โ price is 28% above long-term average
๐ฏ Trade Plan (LONG):
โข Entry Zone: $6.263 - $6.549
โข Stop Loss: $5.836 (below SMA7 4H โ first structural support)
โข TP1: $6.662 | TP2: $6.918 | TP3: $7.175
โก Why This Trade?
Yes, both RSI readings are overbought. But in strong trends, RSI can stay overbought for extended periods. The MACD histogram is still expanding, and price is riding the SMA7 tightly on both timeframes.
The real risk is the L/S ratio at 1.69 โ crowded longs mean a sharp flush is possible if sentiment shifts. That's why SL sits at $5.836, below SMA7 4H ($6.325). If that breaks, the trend is weakening.
Confidence: 74% โ good but not great, because overbought conditions limit upside surprise.
๐ค Overbought = sell signal or strength signal? How do you trade RSI extremes?
โ ๏ธ DYOR. This is analysis, not financial advice. Overbought conditions can persist but reversals tend to be sharp.
#INJ #Injective #DYOR