Friends, As you might have known from the headline that today we will discuss about RSI indicator,why this indicator is so important in crypto trading chart analysis. First of all we must know a little bit about RSI indicator, the full name of RSI indicator is Relative Strength Index indicator. This indicator shows us when we should enter in market and when we should exit. RSI is most valuable for new bees, because when new bees enter in market, they don't know what coin should purchase & when to purchase, this indicator guides them properly.
When we apply RSI on our trading chart, by default its input will be 14, upper limit will be 70 & lower limit 30. Lower limit is called over sold zone and upper limit is called over bought zone. We can change these limits as per our experience , mostly day traders using inputs of 10 or 7 instead of 14. As concern to me I use upper limit 75 and lower limit 25 & input 7, this setting gives me good signals.
Now the question arises that when we purchase a coin & when sell, answer is that when RSI line goes down the below lower limit, this is time to buy and when RSI line goes above upper limit, this is the time to sell coin.with this indicator a new bee, who don't know much about crypto trading, he also can trade with out any loss. After touching over sold zone market goes high and after crossing over bought zone market goes down.