Use of Divergence indications is not part of the main TAW system.
However, we have included it in the last lesson in TAW Module 2 as a bonus as divergence is an useful tool for spotting turning points.
2 types of divergence #
Classical divergence – this is the most commonly known divergence. It is for spotting counter trend reversal. E.g. if the current trend is up, a classical divergence suggests that price might be weakening and is likely to stop going up.
Hidden divergence – this is a with the trend divergence and is used for spotting trend continuation. Hidden divergence is preferred.
Past videos on divergence #
Access to these videos requires The Alien Room subscription.
Use of divergence – classical and hidden divergence. Watch here.
Use of hidden divergence for trend continuation. Watch here.
Use of classical divergence. Apply both hidden and classical divergence to live trades. Watch here.
The divergence indicator is included together as part of the indicator package in the zip file found in our indicator page.