can someone explain to me and give me an easy answer/example of what divergence is??? thankyou for your time in advance......tiago
can someone explain to me and give me an easy answer/example of what divergence is??? thankyou for your time in advance......tiago
You can find more info here:Originally Posted by tiago
http://www.trading-naked.com/Divergence.htm
http://www.stockcharts.com/education...dic_MACD1.html
Basically, a divergence occours when the trend of price high and lows goes one way and the trend of tops and bottoms in oscillators e.g. MACD goes the opposite way. ( see pic below )
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Last edited by TheWolf; August 12th, 2005 at 06:47 PM.
Hi tiago,
Divergence is when the price shows one direction and an indicator shows the opposite direction. Divergence is generally seen as a strong signal for a reversal of price direction.
Check this link out:
http://www.moneytec.com/forums/searc...earchid=106005
It is the result of a search in this forum for 'divergence' in the 'titles only'.
Hope this helps a bit.....
Divergence can also be used to refer to two normally linked/correllated markets when they start to go in opposite directions.
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