Hereโs how intermediate traders actually use RSI โ and what beginners get wrong.
๐ THE BASICS (skip if you know this)
RSI = Relative Strength Index
Measures momentum on a 0โ100 scale.
- Above 70 = "overbought"
- Below 30 = "oversold"
โ ๏ธ THE BEGINNER MISTAKE
Most new traders sell when RSI hits 70 and buy when it hits 30.
This works in sideways markets. In strong trends, it gets you wrecked.
$BTC RSI stayed above 70 for WEEKS during the 2021 bull run.
Anyone who sold "because RSI was overbought" missed 3x gains.
โ
HOW EXPERIENCED TRADERS USE RSI
1๏ธโฃ DIVERGENCE (the most powerful signal)
Bullish Divergence: Price makes lower low, RSI makes higher low โ momentum shift incoming
Bearish Divergence: Price makes higher high, RSI makes lower high โ trend may be ending
2๏ธโฃ RSI AS TREND CONFIRMATION
In uptrends: RSI stays between 50โ80 (buy dips to 50)
In downtrends: RSI stays between 20โ50 (sell bounces to 50)
The 50 level is more useful than 30 or 70.
3๏ธโฃ MULTIPLE TIMEFRAME RSI
Always check RSI on at least 2 timeframes.
Bullish 4H RSI + Bearish Daily RSI = caution, wait for alignment.
4๏ธโฃ RSI + SUPPORT/RESISTANCE
RSI is most powerful when it aligns with a key price level.
Example: $BTC hits major support AND RSI is at 35 โ high-probability bounce setup.
๐ CURRENT $BTC RSI READ
[Add your current RSI reading and what it suggests]
[Add your current $ETH RSI reading and what it suggests]
Save this post ๐ โ share it with someone whoโs been selling tops and buying bottoms wrong.
What RSI setup has worked best for you? Comment below ๐
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