Advanced Rsi Divergence Trading

Oct 20

RSI Divergence occurs when the Relative Strength Index indicator starts reversing before price does. A bearish divergence consists of an overbought RSI reading, followed by lower high on RSI. At the same time, price must make a higher high on the second peak, where the RSI is lower.

If used correctly, RSI divergence can be profitable, providing early signals of trend reversals. However, it also carries risks, and traders should use it alongside other indicators and proper risk management strategies.