@leifjacob
Extreme optimism or pessimism in markets often signals exhaustion. Indicators like RSI above 80 or below 20, MACD divergences, and Bollinger Band squeezes frequently highlight potential reversals. Funding rates in perpetual futures are also valuable—excessively positive suggests longs are overcrowded, while deeply negative signals capitulation. Tracking on-chain flows, especially stablecoin inflows to exchanges, provides early warnings. When market sentiment skews too far, contrarian signals emerge. Thus, combining momentum oscillators with positioning data can reveal turning points, offering traders an edge when most participants are blinded by collective emotion.
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