Relative Strength Index Bitcoin Analysis & RSI Bitcoin Signals

Developed by J. Welles Wilder, this was illustrated in the book "New Concepts in Technical Trading Systems".

RSI tops the list of favored indicators. It acts as a momentum oscillator and trend follower for bitcoin. RSI measures recent price gains against losses. It plots them on a 0-100 scale.

The RSI measures the momentum of bitcoin cryptocurrency: values above 50 indicate bullish momentum, while readings below the 50 centerline signify bearish energy.

Relative Strength Index Bitcoin Indicator - RSI Crypto Indicators

RSI is drawn as a green line
Horizontal dashed lines are drawn to identifying over bought and oversold levels are - 70/30 levels respectively.

Bitcoin Analysis and Generating Signals

There are several different techniques used to trade, these are:

50-level Cross over Signals

Buy trade signal - when the indicator crosses above 50 a buy/bullish signal is given/generated.
Sell Bitcoin Signal - when the indicator crosses below the 50 center mark a sell/bearish signal is given/generated.

RSI Buy Sell Bitcoin Signals - RSI - RSI BTCUSD Indicators

RSI Bitcoin Patterns

Bitcoin traders possess the capability to plot trend lines and chart formations on the RSI indicator. The RSI frequently develops cryptocurrency patterns, such as the head and shoulders formation, which may not be readily apparent on the actual bitcoin price chart.

Bitcoin Support/Resistance Break outs

RSI is a sign that can help predict when prices might break through support or resistance levels. RSI uses a special signal to guess when a bitcoin price is about to break these zones.

Support & Resistance Breakout

Swing Failure - Support and Resistance Breakout

Overbought/Over-sold Conditions on Trading Indicator

Overbought levels above 80
Oversold - levels below 20

You can use these levels to create bitcoin signals, like buying when the RSI goes up from below 20 after being oversold, and selling when the RSI goes below 80 after being overbought. These signals are not good for Bitcoin because they often cause false alarms.

Divergence Bitcoin Trade Setups

Divergence trading is a way to figure out when bitcoin price trends might change direction. There are four kinds of divergences you can trade with, and they're explained in the divergence guide on this website, using the trading indicator discussed.

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