RSI (Relative Strength Index) in crypto: how to read it

What RSI measures

RSI compares the average gain to the average loss over the last 14 candles and squeezes the result into 0 to 100. Fast rallies push it toward 100, fast sell-offs toward 0. It is a momentum gauge, not a valuation: an RSI of 25 says price fell quickly, not that price is cheap.

The classic thresholds are 30 and 70. Between them the reading is neutral and carries little information. The useful zones are the extremes and, more importantly, divergences: price making a new low while RSI makes a higher low is a sign the sell-off is losing speed.

Why crypto RSI needs context

Crypto trends hard. On a 1h chart BTC can print RSI above 70 for six or eight candles during a squeeze while shorts get liquidated. Selling the first overbought reading is how traders get run over. Pair RSI with trend (SMA20 versus SMA50) and with where price sits against the last 20 bars of support and resistance.

How the SIMMENT desk uses RSI

The technical dashboard tile shows RSI 14 on the chart timeframe with a NEUTRAL, OVERSOLD or OVERBOUGHT label. In the setup score RSI below 30 adds three buy votes, below 40 one, above 70 three sell votes, above 60 one. The auto desk only fills when the whole score, not RSI alone, lands on BUY or SELL.

Quick answers

• Stochastic RSI: the faster oscillator on the desk
• MACD for crypto: line, signal and histogram
• Bollinger Bands: range, squeeze and band walks