EUR/USD Nears Oversold RSI Read on the DailyEuro / U.S. DollarFOREXCOM:EURUSDFOREXcomOscillators are often one of the first types of indicators that a trader learns and, in-turn, they're also usually one of the first indicators to be abandoned. "Indicators don't work" is a common refrain and there's probably no type of indicator more responsible for that sentiment than oscillators, key of which is the Relative Strength Index. But, in reality, indicators are just mathematical functions, it's simply a way of looking at the past. And as a wise man once told me, 'any indicator is really just a fancy moving average.' Perhaps more important is one of market fit. An oscillator, showing oversold and overbought values, can work well in a ranging market environment. And less well in a trending environment. And the recent backdrop in EUR/USD is a great illustration of that. Over the past year-plus, EUR/USD has been largely range-bound, along with the US Dollar. And, as such, many of these RSI readings have opened up to some decent setups. Before that, however, in late-2024 and early-2025, as EUR/USD was trending lower and then higher, those RSI extremes were just speed bumps as part of a larger trend, as you can see from the left side of the below chart. At this point, with the USD breaking out to a fresh high after the FOMC meeting, even with a hawkish ECB that just hiked rates, EUR/USD is nearing oversold territory. And while a lagging indicator is unlikely to be predictive, the question traders should ask is whether the US Dollar is on the cusp of a larger breakout - which would likely need USD/JPY to push back above the 160.00 handle, which would, in essence, make Scott Bessent's efforts look to be a failure. Or - are we still in that ranging type of backdrop where a push into oversold could open the door for a pullback or perhaps even a reversal in EUR/USD? - JS