Docker Swarm and network traffic

I’m using Docker Swarm in the latest version and deploying containers to different nodes. Although I’ve read that management traffic is encrypted between master and slave nodes per default, I’m unsure what is about traffic between nodes. So let’s assume a backend application on one node and the database on the oher. Is the traffic between them encypted per default? My imagination was, that the overlay network that is created is already encrypted and so traffic that is routed over it. Is my assumption wrong?