What is RSI oversold? — chart signal explained
RSI compares how strongly price has risen versus fallen over the last 14 candles and boils it down to a single number between 0 and 100. Big gains push it toward 100, big losses toward 0. Think of it as a thermometer for how one-sided recent selling or buying has been.
When does it fire? — BaroBara criteria
On barobara, this signal lights up when the 14-candle RSI drops below 30.
How traders usually read it
Many traders treat readings under 30 as a zone where too much selling happened too fast. The hope is that sellers are running out of steam and price might bounce back, which is why this is a go-to signal for people hunting for rebound spots.
What to watch out for
In a strong downtrend, RSI can sit in oversold territory for a long time while price keeps falling. Below 30 doesn't mean a bounce is coming — it only means a lot of selling already happened. Check the historical stats to see how often it actually worked out.
What the data actually shows (BTC 1d)
The common reading is a bounce (up) — but what actually happened matters more. This signal has fired 25 times on BTC 1d; across the most recent 25, price reached the small target (+0.25%) first about 44% of the time. Widen the target to ±1% and it becomes about 24%. A historical probability, not a guaranteed direction — and it shifts with market regime.
Odds and expected value — with symmetric target and stop (±)
Exactly the barobara framing: which side got hit first, +X% or −X%. Target and stop are set to the same %, and the win rate is how often the upside (+X%) was reached first.
| Target = stop (±) | Win rate (+ first) | EV (before fees) |
|---|---|---|
| ±0.25% | 44% | -0.03% |
| ±0.5% | 36% | -0.14% |
| ±0.75% | 20% | -0.45% |
| ±1% | 24% | -0.52% |
| ±1.5% | 20% | -0.90% |
| ±2% | 32% | -0.72% |
Broken down by market regime
⚠️ This table uses a different basis than the symmetric (±) table above — a small +0.25% target with a wide −5.0% stop (fees included). The small target makes the win rate look high while EV is often negative — exactly what signal groups hide. And the same signal behaves differently across regimes.
| Regime | Win rate (+0.25% target) | EV (−5.0% stop) | Sample |
|---|---|---|---|
| Bear market | 45% | -2.71% | N=20 |
Recent occurrences
How far price actually moved the last few times this signal fired (MFE = maximum favorable excursion).
| Date | MFE | Result |
|---|---|---|
| 2025-12-04 | 0.0% | — 🔴 stopped |
| 2025-12-12 | 4.78% | ✅ hit 🔴 stopped |
| 2025-12-14 | 0.0% | — 🔴 stopped |
| 2026-01-31 | 0.0% | — 🔴 stopped |
| 2026-02-04 | 0.0% | — 🔴 stopped |
| 2026-02-08 | 0.0% | — 🔴 stopped |
| 2026-02-15 | 1.61% | ✅ hit 🔴 stopped |
| 2026-06-03 | 0.0% | — 🔴 stopped |
A free morning briefing: market heat & chart combos — honest odds, not predictions