Category: 1. Trading Divergences

Please keep in mind that we use divergence as an INDICATOR, not as a signal to enter a trade! It wouldn’t be smart to trade based SOLEY on divergences since too many false signals are given. It’s not 100% foolproof, but when used as a setup condition and combined with additional confirmation tools, your trades have a high probability…

Have you had your fill on learning how to trade divergences? Let’s review! Divergence is a popular concept in technical analysis that describes when the price is moving in the opposite direction of a technical indicator. There are two types of divergences: Regular divergence Hidden divergence Each type of divergence will contain either a bullish bias or a bearish bias.…

Divergences are used by traders in an attempt to determine if a trend is getting weaker, which may lead to a trend reversal or continuation. Before you head out there and start looking for potential divergences, here are nine cool rules for trading divergences. Learn ’em, memorize ’em (or keep coming back here), apply ’em to help you…

While using divergences is a great tool to have in your trading toolbox, there are times when you might enter too early because you didn’t wait for more confirmation. If you keep entering too early, you’ll keep getting stopped out (you do use stops right?!) and you’ll slowly rack up losses. And you know what happens when…

Now it’s time to put those Jedi divergence mind tricks to work and force the markets to give you some pips! In this lesson, we’ll show you some examples of when there was a divergence between price and oscillator movements. How to Trade a Regular Divergence First up, let’s take a look at regular divergence. Below is…

We covered regular divergences in the previous lesson, now let’s discuss what hidden divergences are. What’s a hidden divergence? Divergences not only signal a potential trend reversal but can also be used as a possible sign for a trend continuation (price continues to move in its current direction). Always remember, the trend is your friend, so whenever you can get a signal…

What is a regular divergence? A regular divergence is used as a possible sign for a trend reversal. There are two types of regular divergences: bullish and bearish. Regular Bullish Divergence If the price is making lower lows (LL), but the oscillator is making higher lows (HL), this is considered to be regular bullish divergence. This normally occurs at the end of a…

What if there was a low-risk way to sell near the top or buy near the bottom of a trend? What if you were already in a long position and you could know ahead of time the perfect place to exit instead of watching your unrealized gains, a.k.a your potential Aston Martin down payment or future Christian Louboutin high heels,…