Divergences

____________

Private
Messages
17
I have a doubt, in MACD or other indicator with zero line, what happens when market makes a new high but the indicator fails to make a new higher peak, insteadd it's behing zero line, its still a divergence? its weaker or stronger than when indicator makes the (in this case) peak up the zero line.
heres the example

thnkx
 
Last edited:

TJ Woods

Recruit
Messages
2
Divergence Response

Private,

Divergence, IMHO, is viewed subjectively. However, if this aids in your understanding:

1) if Price makes a higher high but the Oscillator makes a lower High it is considered Bearish.. you may note the affects in Price action shortly after the divergence.

2) if Price makes a Lower Low and the Oscillator makes a Higher Low it is to be regarded as Bullish.

Try bringing up a RSI and note the comparison with the MACD and Price action.

Hope this helps.

TJ
 
Top