I want to share a simple thing about RSI because many people are using this indicator incorrectly. I used to do the same at first, but over time I understood how it works.

In short, RSI shows the direction of buying or selling pressure. It is evaluated on a scale of 100 points; when it exceeds 70, it indicates high buying appetite in the market, and when it drops below 30, it means selling pressure is strong. You can examine it on different timeframes such as minute, hourly, daily, or weekly.

Let me clarify a bit about parameter selection. There is a standard 14 parameter, but I usually use 6 or 12. Both have proven to work, and which parameter you choose is a matter of personal preference. Some friends also experiment with a 24 parameter, which is also a reasonable choice. The important thing is to find out which parameter gives you better signals.

My strategy works like this: if I see the daily RSI drops below 10, I first check the news. If there’s nothing important, I try to add it to my portfolio. When I see it above 90, I look for a selling opportunity. But this is entirely a decision I make based on the daily chart. Trading solely based on RSI is risky, always remember that.

You also need to be careful when choosing the timeframe. For scalp trading, I examine the 1-minute or maximum 15-minute chart. For spot buying, I look much more carefully at 4-hour, daily, and weekly charts. The larger the timeframe, the more reliable the signal.

One more important point: bots generally interpret above 70 as a strong buy signal and give buy signals. I use these signals in the opposite way. When the daily or weekly RSI drops below 30, I look for a buying opportunity; when it exceeds 70, I find a selling opportunity.

If you want to understand this indicator better, observe how it works on a 1-minute or 3-minute chart. Seeing RSI movement in short timeframes will help you improve your long-term strategy. Over time, you will understand this indicator much better.