rachanak

divergence set up - some basic learning

Education
FX_IDC:USDEUR   U.S. Dollar / Euro
what is Divergence ? 👇
Divergence is when the price of an asset is moving in the opposite direction of a technical indicator, such as an oscillator, or is moving contrary to other data. Divergence warns that the current price trend may be weakening, and in some cases may lead to the price changing direction

what is Oscillator ? 👇
An oscillator is a technical analysis tool that constructs high and low bands between two extreme values, and then builds a trend indicator that fluctuates within these bounds. Traders use the trend indicator to discover short-term overbought or oversold conditions.

how is Oscillator used in Trading ? 👇
Oscillators are chart indicators that can assist a trader in determining overbought or oversold conditions in ranging (non-trending) markets. Most traders use multiple oscillators to confirm range extremes and for determining the important entry and exit points.

🛑Indicators for spotting the divergence indicator patterns are the Awesome Oscillator , macd , the RSI , CCI or stochastic .🛑

disclaimer - personal view (can be wrong)

Comments

Good explanations. Quite a few people will use RSI and Price looking for divergences.
+1 Reply
rachanak AngusMcK
@AngusMcK, thank you👍 ....so for me rsi + adx + price action gives wonderful picture for divergences
+1 Reply
AngusMcK rachanak
@rachanak, rsi + adx + price action is my favourite combination.
+1 Reply
rachanak AngusMcK
@AngusMcK, so great to hear that
Reply
rachanak AngusMcK
@AngusMcK, do share if u have any specific method penned down that u follow, if u dont mind. thnx
Reply
AngusMcK rachanak
This isn't my website but is a strategy I liked. See if the URL gets autobanned by the site. https://finmaxfx.com/en/investment-strategies/298-ema-rsi-adx.html
+1 Reply
rachanak AngusMcK
@AngusMcK, thank you very much
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Where do we get Newton Index and Da-Vinci Code?
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OK I agree part of your Explanation here , Would like to add to your Knowledge (In case you know it already then ignore My Message )

01) RSI , Stochastic , CCI are Oscillators , they Oscillate between two Pre-defined Price by % , Remember they only represent how Much % strength in the Movement of trend or Particular Candle after close
they represent specified calculations in % gain or loss , that is the reason they are called as Oscillators by Band width.

02) Awesome Oscillator , MACD , both are price representing Indicators , They represent Momentum of the Price Not the % of the price , if you check carefully each bar in AO or MACD represent price of X period calculated Momentum , Both are defined strength in Momentum by Visual Representation of Zero Line , Bar in the Indicator below the Zero line indicate price is below the Calculated Momentum , Bar above the Zero Line indicate Price is above the calculated Momentum

I have made one Video to check the MACD Price bar by bar and calculation of How much the Price is away from Peak Momentum you can visit it and can get More insight or Visit Investopedia for detailed materials

Good luck
Reply
rachanak ShreeKrishna
@ShreeKrishna hi sir, thank you for sharing your knowledge
Can you please share the link you have mentioned to check please
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