Category: Technical analysis

Understanding Overbought and Oversold Conditions When it comes to trading in the financial markets, understanding overbought and oversold conditions is crucial. These terms refer to the levels at which a particular asset is considered to be trading at unsustainable levels, and a reversal in price may be imminent. By recognizing these conditions, traders can make more informed decisions about when to buy or sell an asset. What are Overbought and Oversold Conditions? Overbought and oversold conditions are typically identified using technical indicators such as the Relative Strength Index (RSI) or the Stochastic Oscillator. These indicators measure the momentum of a ... Read more