Analyse Trading
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Divergence

A divergence occurs when price and an oscillator move in opposite directions, for example a new price high without a new RSI high.

The classic bearish divergence: price makes a higher high, the indicator a lower high. Momentum is fading despite the apparent rally. A bullish divergence is the opposite, on the lows.

There are also hidden divergences, used as continuation signals: in an uptrend, price makes a higher low while the oscillator makes a lower low.

A divergence is a warning, not an entry signal. It can last a long time, and several divergences can follow one another before a trend turns. Wait for a structure break or a candlestick pattern before acting.

The full lessonDivergences: when price and momentum stop telling the same storyBullish or bearish, regular or hidden divergence: spot the disagreements between price and the RSI or MACD, then wait for price confirmation before you act.← Full glossary