Hello friends .... !!!
Back again with me Ichsan Angga P at Steemit Crypto Academy Homework.
Today I will finish the homework from professor @kouba01.

The topic that I will choose to discuss from the work given by the professor @kouba01 This week's assignment is about Cryptocurrency Trading with RSI

The Relative Strength Index (RSI) is a technical indicator tool that aims to analyze the trading market in crypto stocks. The first Relative Strength Index (RSI) was created in 1972 by a man named Welles Wilder, which was the year he was expelled from the company where he worked, it was from 1972 that Welles Wilder looked for a good tool in predicting profit trends in the world. crypto, until finally the Method which together with the Relative Strength Index (RSI) was officially introduced to all people in the world in 1978.

The Relative Strength Index (RSI) also has a role as a momentum measuring tool to see price movements in crypto stocks.If there is an increase in momentum it has a sign that the stock is actively buying, whereas if the momentum is decreasing it has a sign that the stock is in a trend the weak.

The RSI is not only a momentum measuring tool, the RSI can also act as an oscillator, which means traders will be able to find out market conditions, whether the market is Overbought or maybe the market is experiencing Oversold. The RSI has a scale of 0-100, so to indicate Overbought means that the RSI value exceeds the 70 number scale and for Oversold the RSI value is below the scale value of 30.And to indicate a buy / sell signal, it can be seen if the RSI value is above 50 it is a trend up or bullish trend, whereas if the RSI is below 50 it is a downtrend or a bearish trend.

The RSI value can be calculated using a formula like this:

So I immediately demonstrated, in the RSI it always takes the benchmark of 14 units as the default, for example ETH works in an up position for 7 days and in the end it has a profit of 3% and 7 days later it has a poor performance so it has a loss as much as 2,3%, Let's try to calculate it using the RSI formula that I gave above:

From the data used :

• Average Gain = 3%
• Average Loss = 2,3%

Then the results RSI = 56,61

So in the example above the RSI results obtained are 56.61, this number is on a scale of 50 and above, which means that the RSI chart will increase (Bullish Trend), if the number is on a scale of 70 we will catch it as an overbought asset. , and if the RSI value can be on a scale below 50, it means that the asset is experiencing a decline (Bearish trend), and if the asset's value is on a scale of 30 or even below it, then the asset is included in an oversold asset.

RSI is a useful tool or indicator in the world of crypto set trading, which uses the RSI indicator traders can trade by reading the trend code first, whether the trend is going up or the trend is going down. Even though the RSI is a Momentum indicator that is currently very helpful for us in trading assets, we still need to always be aware of stock market trends in the crypto world.

As we know in this crypto world, if we don't use the RSI carefully then we will get results that cause it to mislead us, and be more careful in reading market trends in the crypto stocks you choose, in order to avoid whose name is miscalculated.

I will explain it through the trading application that I use today:

• Enter the application, then select the asset you want, here I choose the BTC / IDR asset, click on the asset and the chart will appear as shown below.

• After the graphic appears, click studies and select RSI, as shown below.

• If you want to set the default RSI, open studies again and click RSI and set the default RSI you want, like this

I will take an example of an RSI above 70 (overbought assets) and an RSI below 30 (oversold assets), these are the examples I captured:

• The example I took is BTC / IDR assets on April 13, 2021, assets are above 70, then assets are Overvbought

• The example I took is BTC / IDR assets on March 12, 2020, assets are below 30, then Oversold assets

So here I will give an example for the false signal contained in the RSI, which to see the false signal at the RSI is called a bullish divergence or bearish divergence. so this is an example.

• If the RSI is lower than 50, the RSI chart will go down and hence indicate a bearish trend. If it were 30 or less, we would call it an oversold asset.

• Because the asset indication is below 30, this asset is called a bullish divergence, as in the example below

• Because the asset indication is above 50, this asset is called a bearish divergence, as in the example below

Next I will review the chart contained in the TRX / IDR stock along with the RSI signals contained in the asset, here are the results of my review.

From my review of TRX / IDR assets, there are 2 signals of overbought assets because they are at the RSI number, which is above 70, and the next 2 signals indicate bearish divergence, because the RSI number is above 50.

The RSI is a tool that was created to make it easier for traders to correct and predict the time and trend of trading their crypto assets, where the RSI serves as an oscillator momentum indicator which is tasked with making it easier for traders to read overloaded asset and asset signals. overbought, making it easier to place a sell / buy position. The RSI can be a good indicator if used with care and accuracy, it can also be a bad asset indicator if you are a foolish trader.

Last word

I apologize to readers because I still have a lot of information to convey about Cryptocurrency Trading with RSI, which is far from perfect.

Thank you to all of you who have read my post, I hope my post can be useful for all of you.

Regards
@ichsananggap

Note: All Images which are not source are from my own screenshots and edits.