Technical analysis is the foundation of most trading strategies, including those used by Legion Bot. Understanding key indicators helps you interpret our daily reports and make informed decisions.
RSI (Relative Strength Index)
RSI measures momentum on a scale of 0-100. Above 70 is overbought (potential pullback), below 30 is oversold (potential bounce). We use RSI across 1H, 4H, and daily timeframes. Divergences between price and RSI often signal reversals.
MACD
MACD shows the relationship between two EMAs. Bullish crossover (MACD above signal) suggests buying, bearish crossover suggests selling. Histogram divergence can signal weakening momentum.
EMA (Exponential Moving Average)
Common periods: EMA 9, 21, 50, 200. Bullish alignment means 9 above 21 above 50 above 200 indicating uptrend. Golden cross (50 above 200) is a major bullish signal. Death cross is the opposite.
Combining Indicators
No single indicator is reliable alone. Legion Bot requires alignment across at least 3 indicators before generating high-confidence signals, significantly reducing false signals.