True strength index is a crossover momentum oscillator indicator.
As a crossover momentum oscillator indicator,True strength index indicator was created by William Blau to help traders know whether the market has experienced an overbought or oversold condition.As a crossover momentum oscillator,True strength index indicator has two crossover lines,the red and the blue line.The red line indicates the signal line while the blue line indicates the true strength indicator.
True strength index indicator has oscillation at point 0 ranging between -100 to 100. When crossover occurs at above 25,that is an indication of an overbought market while when it occurs at below -25,that is an indication of an oversold market.
According to William Blau, the values of True strength index is calculated as follows;
True strength index indicator(TSI)=( DOUBLE SMOOTH PRICE CHANGE/DOUBLE SMOOTH ABSOLUTE PRICE CHANGE)*100
We can therefore further explain the indicator based on oversold and overbought condition as follows;
1. True strength index cryptocurrency oversold
Since True strength index indicator is an oscillator and is based on crossover of the TRI above or below the signal line to indicate oversold and overbought in the market ,it therefore follows that when the True Strength index crosses above the signal line at below -25,that will be an indication of an oversold market thus the cryptocurrency trader should buy a given amount of cryptocurrency with their USDT balance. The cryptocurrency trader can either place a market buy order which will be processed immediately or they can place a limit buy order which will be processed when the market reaches their limit buy order. This is indicated as from the candlesticks chart below;

2. True strength index cryptocurrency overbought
Since True strength index indicator is an oscillator and is based on crossover of the TRI above or below the signal line to indicate oversold and overbought in the market ,it therefore follows that when the True Strength index crosses below the signal line at above 25,that will be an indication of an overbought market thus the cryptocurrency trader should sell a given amount of cryptocurrency which he had previously purchased and is currently holding in order to avoid declining the value of their account. The cryptocurrency trader can either place a market sell order or they can place a limit sell order. The market sell order will be processed immediately while the limit sell order will be processed when the market reaches their limit order price. This is indicated as from the candlesticks chart below;

Cryptocurrency market is a highly volatile market. As a cryptocurrency trader,whenever you place a buy order,always make sure to apply risk management so that whenever your buy order goes against you, your account do not depreciate so much in value.
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