RSI = Relative Strength Index — a momentum oscillator that measures how fast and how much the price has moved recently. It's one of the most common indicators in crypto (and all trading).
How it's calculated
RSI compares average gains vs. average losses over a period (usually 14 candles — 14 days, 14 hours, or whatever timeframe you're on):
- RSI = 100 − (100 / (1 + average gain ÷ average loss))
- The result always lands between 0 and 100.
What the levels mean
- Above 70 = "overbought" — the market has risen fast, and traders often read this as a possible pullback or a sign buying momentum is stretched.
- Below 30 = "oversold" — price has fallen hard, sometimes read as a potential bounce or that selling is exhausted.
- Around 50 = neutral, roughly balanced momentum.
The catch in crypto
- Overbought ≠ automatic sell signal. In strong uptrends RSI can sit above 70 for a long time — momentum can stay stretched. Similarly, oversold can stay oversold in a downtrend.
- Divergence is where it's often most useful: if price makes a new high but RSI makes a lower high, that's "bearish divergence" (weakening momentum). The reverse (price lower low, RSI higher low) is "bullish divergence."
- RSI is a lagging reflection of recent candles — it tells you what already happened, not the future. It's best used with other signals (volume, trend, support/resistance), not alone.
- Crypto is 24/7 and far more volatile than equities, so overbought/oversold thresholds get hit more often and mean less in isolation.
If you want, I can pull live prices and 24-hour moves for a coin you're looking at to see what the current momentum picture looks like — just name one.