Divergence trading is a momentum and price action method that compares market price to an oscillator to reveal early trend exhaustion and potential...

Divergence trading is a momentum and price action method that compares market price to an oscillator to reveal early trend exhaustion and potential reversals. When price makes a higher high but momentum fails to confirm, or price sets a lower low while momentum strengthens, traders gain a probabilistic edge for sharper entries, exits, and risk placement. Popular tools include RSI, MACD, and Stochastic, applied across stocks, forex, crypto, and futures on multiple timeframes. Combine divergence signals with structure, volume, and strict risk management to filter noise, improve timing, and avoid chasing late moves. We cover regular and hidden divergences, multi timeframe confirmation, and rules for stop loss and take profit placement, so your plan stays consistent in trending and ranging markets.

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