I've been using RSI for a while now, and honestly it's one of those indicators that actually works if you know what you're looking at. The basic idea is simple enough—it measures momentum from 0 to 100, so anything above 70 suggests overbought conditions and below 30 suggests oversold. But that's just the starting point.

What most people miss is that RSI works completely differently depending on whether you're in a trending market or a ranging one. In a range, those 70/30 levels are legit reversal signals. But if you're in a strong uptrend and RSI dips below 30? That's not a sell signal—that's a buy the dip opportunity. Context matters way more than people think.

The real edge comes from divergences. I look for situations where price makes a lower low but RSI makes a higher low (bullish divergence), or price goes higher but RSI doesn't follow (bearish divergence). These setups catch reversals before they fully play out. The trick is using higher timeframes to confirm them though, otherwise you get faked out constantly.

One thing I've found useful is drawing trendlines directly on the RSI itself. When RSI breaks through one of these trendlines, it often signals a shift in momentum. Combine that with a volume spike and you've got a solid entry point. Also worth watching for RSI swing failures—when RSI crosses 70 but can't break higher, or crosses 30 but can't break lower, those are strong reversal signals if they align with support and resistance zones.

I always pair RSI with other indicators rather than using it standalone. Moving averages help confirm trend direction, MACD adds momentum confirmation, and Fibonacci levels give you precise zones where RSI signals matter most. The combination is way more reliable than any single tool.

If you're building an RSI cheat sheet for yourself, focus on these core patterns: overbought/oversold reversals in ranges, divergences for early reversals, trendline breakouts for momentum shifts, and swing failures for strong reversal confirmation. Set up alerts so you don't miss setups, and always respect volume—weak volume spikes don't mean much.

The biggest mistake I see is people treating RSI like a mechanical system. It's not. You need to read the market context, understand what trend you're in, and use RSI as confirmation rather than the whole strategy. Pair it with solid risk management and you've got something that actually works over time.