Divergence

What is Divergence?

Divergence

How do oscillator indicate divergence ?

Role of Divergence in Chart Analysis

Price is in uptrend &

momentum indicator making low and lower low

Price is in downtrend &

Momentum indicator is making high and higher high

What is Divergence

Bill Williams, Awesome Oscillator (AO) to measure divergence.

High

Higher high

High Lower High

How do oscillators indicate divergence

High

Higher high

High

Lower High

Divergence indicating Downtrend

Downtrend

Role of Divergence in Chart Analysis

Low

Low

Higher

Low

Lower Low

Uptrend

Divergence indicating Uptrend

Role of Divergence in Chart Analysis

In wave pattern, divergence helps to locate the 5th wave of the Motive wave as the 5th wave

usuallyshowloweringof momentumwhich isvisiblethroughdivergence appearing in an oscillator.

Recommended indicator to usefordivergence are Awesome Oscillator,

Role of Divergence in Chart Analysis

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