What is Divergence? - Definition & Explanation

Definition

When price moves in the opposite direction of a technical indicator, signaling a potential reversal.

Divergence Explained

Divergence occurs when price moves one direction while a technical indicator (like RSI or MACD) moves the opposite direction, suggesting weakening momentum and a potential trend reversal.

Divergence - Frequently Asked Questions

Divergence is a warning signal, not a guarantee. It's more reliable on higher timeframes and when confirmed by multiple indicators.

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