## Understanding Divergence: Contradictory Signals That Change Trading Directions
What is divergence? Simply put, it's "the price doing one thing, but the indicator showing another." A situation where the price and technical analysis tools are not in agreement. This is what we call divergence. It typically occurs when the current trend is weakening, and the market prepares for a reversal.
Tools used to detect divergence are mostly oscillator indicators such as MACD, RSI, or Williams %R. These programs help us see the strength of the price momentum. When the price and the indicator move in diff
View OriginalWhat is divergence? Simply put, it's "the price doing one thing, but the indicator showing another." A situation where the price and technical analysis tools are not in agreement. This is what we call divergence. It typically occurs when the current trend is weakening, and the market prepares for a reversal.
Tools used to detect divergence are mostly oscillator indicators such as MACD, RSI, or Williams %R. These programs help us see the strength of the price momentum. When the price and the indicator move in diff