RSI Above 70 Explained: Overbought Does Not Always Mean Sell
Understand why RSI above 70 can show strong momentum, not only reversal risk.
High momentum is not an automatic sell
RSI at or above 70 is commonly described as overbought. It means recent positive price changes have been strong relative to negative ones. Trending markets can hold elevated readings through many candles; the threshold is not a timer for reversal.
Persistence versus separate events
If RSI remains above 70 for ten consecutive 15-minute readings, the scanner can count ten overbought candles. That is one sustained episode in ordinary language, not necessarily ten independent signals or ten trading opportunities.
Questions to ask
Is price extending away from support or consolidating above a breakout? Is participation increasing? Where would your interpretation fail? Use the count as a measure of persistence and keep it separate from win rate or expected return.
Count candles, not trade opportunities
Hypothetical worked example. Consider RSI readings of 69, 72, 75, 73, 68. Three candles qualify as overbought, but there is only one transition from below 70 to above it. FuturesRadar adds three to OB for this sequence. Treating those candles as three separate successful signals would overstate the evidence.
Does overbought mean an immediate short?
No. A persistent trend can keep RSI elevated. Check whether a proposed reversal has price confirmation; the scanner itself does not calculate a short-entry rule.
Verify the assumptions
Check the input window, fees and data availability before applying this example. For the exact software behavior and coverage limits, read the scanner methodology. Examples explain arithmetic and interpretation; they are not historical performance claims.