$TREE Momentum Indicators
Relative Strength Index (RSI) : Measures the magnitude of recent price changes to evaluate overbought or oversold conditions. Readings above 70 indicate overbought, while readings below 30 suggest oversold conditions.
Moving Average Convergence Divergence
(MACD) : Shows the relationship between two moving averages. A MACD crossover above the signal line can indicate an uptrend reversal, while a crossover below suggests a downtrend reversal.
Stochastic Oscillator: Compares a security's closing price to its price range over a given period. Values above 80 suggest overbought conditions, while values below 20 indicate oversold conditions
Reversal Signals
Divergence.: Occurs when the price and indicator move in opposite directions, signaling a potential trend reversal.
Crossover: When a shorter-term moving average crosses above or below a longer-term moving average, indicating a potential trend change.
Chart Patterns.: Certain patterns, such as head and shoulders, double tops, and double bottoms, can signal potential reversals.