“Divergence is the most important aspect of oscillator analysis.”
— John Murphy
When price moves to a new low and technical indicators do not, you have a positive divergence.
When price moves to a new high and technical indicators do not, you have a negative divergence.
The development of a positive technical divergence tells us price may not be as weak as it appears.
The development of a negative technical divergence tells us price may not be as healthy as it appears.
Oscillator analysis and divergence provide valuable information for traders.
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