What is Divergence Forex? - What is Bullish Divergence?

What is Divergence Forex Definition? - Divergence is a forex trading setup used by traders - divergence forex trading involves looking at a forex chart and a forex indicator - for example MACD indicator.

To find this divergence forex trading set up find two chart points which forex price makes a new swing high or a new swing low but the MACD indicator does not do the same, this signals a divergence between forex price & MACD technical indicator momentum.

For a divergence forex trading set up we look for two chart points, two highs that form an M shape on Forex trading chart or 2 lows that form a WShape on trading chart. Then look for same M shape or W Shape on Forex MACD indicator.

Example of a Divergence Forex Trading Trade Setup:

In the EURUSD forex chart below we spot two chart points, point A & point B (swing highs). These 2 chart points form an M shape on forex price chart.

Then using MACD indicator we check highs made by MACD technical indicator, these are the highs that are directly below the Chart points marked A and B.

We then draw one line on the Forex trading chart & another line on the MACD indicator.

Divergence Forex Signals - What's Divergence Forex Meaning and Definition?

The forex chart above shows an example of hidden bearish divergence forex trading setup.

What is Divergence Forex Trading - What is Divergence Forex?

In order to trade divergence forex signal we look for following:

• HH : Higher High - two highs but the last one is higher
• LH : Lower High - two highs but the last one is lower
• HL : Higher Low - two lows but the last one is higher
• LL : Lower Low - two lows but the last one is lower

Divergence Forex Trading Terms Definition: What's Divergence Forex Trading?

M shapes on Forex charts dealing with price Highs

W Shapes on Forex Trading charts dealing with price lows

M Shapes on Forex Charts - Bearish Divergence - Bullish Divergence

W Shapes on Forex Charts - Bearish Divergence - Bullish Divergence

What is Divergence Forex Trading? - What is Divergence Forex? - What is Bullish Divergence? - What is Divergence Forex Explanation? - What is Divergence Forex Definition?