Which value indicates an overbought condition in the MFI?

The correct indication of an overbought condition in the Money Flow Index (MFI) is represented by a value above 80. The MFI is a momentum indicator that measures the buying and selling pressure of an asset. Values exceeding 80 suggest that the asset has been overbought, meaning that there has been excessive buying relative to selling, which can lead to a price correction or pullback. Traders often look at overbought readings as potential signals to sell or to be cautious about entering new long positions, anticipating that the market may soon reverse or consolidate.

Understanding the context of this metric is crucial for traders looking to make informed decisions based on market sentiment and price momentum. Lower values, on the other hand, would not indicate overbought conditions; instead, they may signal alterations in market demand or selling pressure.