RSI (Relative Strength Index) measures how fast price has moved on a 0–100 scale. Above 70 is often called overbought, below 30 oversold, but in strong trends it can stay overbought for a long time.
MACD shows the relationship between two moving averages and can highlight momentum changes and divergence.
Indicators are most useful as confirmation of price action, not as stand-alone triggers.
The risk: stacking many indicators creates redundancy and noise. Two or three, understood well, beat eight you do not understand.
Takeaways
- RSI measures momentum from 0-100; MACD shows relationships between MAs.
- Indicators confirm price action, they are not stand-alone triggers.
- Fewer indicators you understand beat many you do not.
Self-check
Can RSI stay 'overbought' for a long time?
Yes, especially in a strong trend; overbought does not automatically mean a reversal.
Trading involves risk. Educational only, not advice. Mark it complete to bank progress.