What is MACD Stocks Trading Divergence?
MACD Stocks Trading Divergence Stocks is one of the stocks strategy used by online stock traders to analyze stocks chart price movement. MACD Stocks Trading Divergence involves looking at a stocks chart and one more stock technical indicator - MACD indicator. For our this stocks divergence tutorials we shall use the MACD indicator - MACD Stocks Trading Divergence.
To spot this MACD stock trading divergence trading set up find two chart points at which stocks price makes a new swing high or a new swing low but the MACD indicator does not do the same, thus indicating that there is a divergence between the stocks price & momentum.
MACD Stocks Divergence Example:
In the stock chart below we spot two chart points, chart point A and chart point B (swing highs)
Then using MACD technical indicator we check the highs made by the MACD stocks technical technical indicator, these are the highs which are direct below the Chart points marked A and B.
We then draw one line on the stock chart & another line on the MACD technical indicator.
MACD Stocks Divergence Explanation - Bullish Stock Divergence MACD - Bearish Stock Divergence MACD - MACD Stock Divergence Guide
How to trade MACD stocks trading divergence
In order to trade MACD stock trading divergence set-up we look for the following setups:
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 - 2 lows but the last one is higher
LL - Lower Low - 2 lows but the last one is lower
First let us look at the examples of these stock trading divergence trading terms
What is MACD Stocks Divergence? - Stocks Trading MACD Divergence Definition - Stocks Trading MACD Divergence Explained
MACD Stocks Trading Divergence Definition - MACD Divergence Stocks Explained - MACD Stocks Divergence Strategy PDF - MACD Divergence Stocks Guide
There are two different types of stocks MACD divergence setups:
- MACD Classic Divergence
- MACD Hidden Divergence
