Divergences are best secret reversal indicator and continuation signals
Divergences can be a momentum traders best friend, it can tell you many useful things such as trend continuation or trend reversal. Unfortunately, for many beginning traders (and some advanced) they can be very hard to spot on a chart.
However there was an easier way to spot and use divergences in your strategy by using the indicator designed by a user named LonesomeTheBlue on TradingView and is called Divergence For Many Indicators v4
How does it work?
The indicator checks for divergences between current and any of last 16 Pivot Points (configurable) for the oscillators on each candle. It then shows a shape on the candle indicating that there is a divergence between the price and the selected indicators.
The indicator contains a vast array of features and configurable setting such as:
Scanning for divergence on many commonly used indicators such RSI , MACD , MACD Histogram, Stochastic , CCI , Momentum, OBV, VWMACD, CMF and many more!
Positive regular and hidden divergences. Negative regular and hidden divergences.
Show pivot points on the price chart
Looking for divergences on ANY external Indicator!
In this post, we went over a hidden gem in the trading view public library that makes spotting divergences a breeze. Try it out by yourself with paper trading and comment below what you think of this indicator.
This article is purely for educational purposes only as with other content on this website.