Divergences are one of my favorite trading concepts because they offer very reliable high-quality trading signals. Although indicators are somewhat lagging – just like price action is lagging too – when it comes to divergences, this lagging feature is actually going to help us find better and more reliable trade entries as we will see below. Divergences can not only be used by reversal traders, but also trend-following traders can use divergences to time their exits. What is a divergence? Let’s start with the most obvious question and explore what a divergence really is and what it tells you about price. You’d be surprised how ...READ MORE
