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What is hidden divergence in forex trading?

Hidden Divergence: Suggests a continuation of the current trend. It appears when the price shows a lower high or higher low while the indicator demonstrates the opposite. Identifying divergence in forex trading is a skill that, once mastered, can significantly enhance a trader’s ability to forecast market movements.

What is divergence trading?

There is a way! It’s called divergence trading. In a nutshell, divergence can be seen by comparing price action and the movement of an indicator. It doesn’t really matter what indicator you use. You can use RSI, MACD, Stochastic, CCI, etc.

What indicators are used in divergence trading?

Popular indicators to use with divergence trading include the MACD, Awesome Oscillator, Stochastic Oscillator, and the RSI. While divergences can signal an impending price reversal, they do not always. Sometimes price action may slow from an up or down trend into sideways momentum following a divergence.

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