From The Free Forex Encyclopedia

Jump to: navigation, search

Divergence is a trading pattern in which the relationship between price action and an oscillator indicator is measured.

If the price begins to move in a negative correlation to an indicator, (ie. higher "highs" in price, but lower "highs" in indicator), it could be viewed as a leading indicator for a potential change in price direction.

Related Articles:

Leading Indicators (Oscillators)

Regular Divergence

Hidden Divergence

9 Rules for Trading Divergences

Divergence Cheat Sheet

"To be successful you have to be selfish, or else you never achieve. And once you get to your highest level, then you have to be unselfish."
Michael Jordan
Clicky Web Analytics