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Alpha Indicators

Alpha Charts include a set of fully automated indicators that replicate what experienced technical analysts manually draw and track. Each of these overlays is:

  • Built from end-of-day confirmed price structure
  • Screenable across the entire platform
  • Used by the AI strategy engine to calculate risk/reward, structural bias, support/resistance zones, and signal quality

Alpha Trendlines​

Alpha Charts automatically draw AI-selected trendlines based on a proprietary model that analyzes billions of potential connections across each symbol’s price history. Rather than drawing every possible line, the system intelligently filters and selects:

  • A set of the most significant trendlines across all timeframes — long-term, mid-term, and short-term
  • Lines with the highest number of touchpoints, validation, and predictive power
  • Levels that match how a trained technical analyst would interpret the chart

Importantly, only trendlines that remain unbroken as of the most recent regular market close are displayed. This ensures that every trendline shown still carries structural relevance and can act as a valid support or resistance level. Once a line is decisively breached, it is removed or replaced by the AI engine to maintain chart accuracy.

By focusing only on trendlines that remain intact at the start of the trading day, Alpha Charts deliver clear, real-time levels that continue to shape market behavior — without noise or outdated signals.

Auto Fibonacci​

Fibonacci levels are drawn automatically between the most recent confirmed peak and bottom pivot — based on the AI’s structural analysis of higher highs, lower lows, and meaningful turning points.

These retracement and extension zones are widely used in technical analysis because they reflect natural rhythm and psychology in price movement. As traders and institutions respond to fear, greed, and mean reversion tendencies, price tends to respect Fibonacci ratios with surprising regularity.

The levels are measured relative to the midpoint (0) between the auto detected peak and bottom anchor points:

  • Negative values (e.g., -0.236, -0.382, -0.618) represent retracement levels — how far price has pulled back from the midpoint toward the original pivot.
  • Positive values (e.g., 0.236, 0.382, 0.618) represent extension levels — how far price may travel beyond the midpoint and anchor in the direction of the trend continuation.

Tracked Fibonacci Levels​

  • 0 – midpoint between the peak and bottom anchor
  • 0.236 – shallow pullback, often tested in fast or strong trends before continuation
  • 0.382 – the first significant retracement level, often marking the start of a deeper correction
  • 0.618 – the "golden ratio," where most healthy corrections stabilize before resuming
  • 0.786 – a deep retracement that often signals the final pullback before reversal or failure
  • 1 – return to the original pivot (full retracement)
  • 1.236 / 1.382 / 1.618 / 2 – common extension targets used to project trend continuation beyond the previous pivot

These levels are not just static overlays — they are dynamically anchored to the most relevant swing points as price evolves. The AI continuously monitors for new pivots and updates the Fibonacci structure accordingly, ensuring that the levels stay aligned with the most current chart structure.

Why Fibonacci Levels Matter​

  • Psychological Anchors: These levels are tracked by millions of traders, making them self-reinforcing
  • Reversal Zones: Retracements often signal areas of exhaustion or entry for counter-trend plays
  • Continuation Targets: Extensions help forecast where price may expand after breaking a prior high/low
  • Risk/Reward Planning: Levels often align with support/resistance clusters, helping define stop and target zones

Last 5 Gaps​

Gaps are automatically detected whenever price opens more than 0.3% away from the prior close. Alpha Charts display:

  • The last 5 historical gaps on the chart
  • The current day’s gap, if applicable

Gaps are important because they often act as support/resistance zones:

  • Gaps up can act as support when revisited
  • Gaps down can act as resistance during rebounds
  • Unfilled gaps can signal directional conviction or upcoming mean reversion

MarketAlpha tracks these gaps in real time and integrates them into its risk modeling and structure-based filtering.

Last Peak & Bottom Levels​

The system continuously identifies the most recent significant peak and bottom levels, based on confirmed structural pivots:

  • Higher highs / higher lows
  • Lower highs / lower lows

Only the most recent confirmed high or low is shown — one that has created a validated swing point and not just temporary noise. These levels:

  • Help establish current trend direction
  • Mark important break/rejection points
  • Act as anchors for Fibonacci and AVWAP indicators
  • Serve as confirmation points for structure-based setups

RSI and Divergence Detection​

Alpha Charts use a 14-day Relative Strength Index (RSI) to measure price momentum and identify bullish or bearish divergences. The RSI is automatically calculated, and divergence lines are drawn using AI analysis — no manual work required.

RSI Thresholds​

  • Above 70 → overbought territory
  • Below 30 → oversold territory
  • Crosses back through these levels often signal a shift in momentum

Divergences​

MarketAlpha automatically detects normal and hidden divergences, both bullish and bearish:

  • Bullish divergence: price makes lower lows, but RSI makes higher lows
  • Bearish divergence: price makes higher highs, but RSI makes lower highs
  • Hidden bullish divergence: price makes higher lows, RSI makes lower lows
  • Hidden bearish divergence: price makes lower highs, RSI makes higher highs

Just like with trendlines, the AI analyzes billions of potential divergence lines and filters for the most recent and valid ones. Divergences are categorized as:

  • Confirmed → occurs at least 1 full day ago and remains valid if not invalidated at regular market close
  • Unconfirmed → detected on the current day; needs 1 bar (day) to confirm

These divergences help identify early momentum shifts, potential reversals, or trend exhaustion. Since divergence is a lagging signal, confirmation adds critical reliability — and all divergences are fully searchable using MarketAlpha’s screeners. Divergence needs at least 1 day to be confirmed. Only the latest detected divergences that are still active are displayed.

Each indicator in Alpha Charts is not only visual — it's a core part of the strategy engine, screener logic, and risk/reward analysis. By combining structure, momentum, and price behavior, these overlays bring clarity to complex markets in a fully automated way.