Lesson

RSI + MACD confirmation | Options Educator

Stack oscillators to confirm a pullback entry and see signal drift over time.

In this lesson

Understanding RSI

• RSI measures momentum, not direction
• 70+ is overbought, 30- is oversold
• Divergences can signal reversals
• Combine RSI with trend analysis

Understanding MACD

• MACD has two lines and a histogram
• Crossovers generate buy/sell signals
• Zero line crossovers confirm trend changes
• Best used in trending markets

Combining RSI and MACD

• Multiple indicators agreeing = stronger signal
• RSI for oversold/overbought, MACD for trend
• Look for confluence of signals before entry
• Divergences in both indicators are powerful

Options Trading with Oscillators

• Oversold + support = buy calls
• Overbought + resistance = consider puts
• Divergences offer asymmetric opportunities
• Match strategy to market condition

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