Push3 V5

Divergence in trading charts signals potential trend reversals by showing a mismatch between price action and an oscillator indicator. There are two main types: regular divergence (predicting trend exhaustion) and hidden divergence (suggesting trend continuation). Regular bearish divergence occurs when price makes a higher high, but the indicator (like RSI or MACD) forms a lower high, indicating weakening upward momentum. Conversely, regular bullish divergence appears when price prints a lower low, but the indicator forms a higher low, hinting at slowing downward momentum. Hidden bearish divergence happens during a pullback in an uptrend where price makes a higher low, but the indicator shows a lower low, suggesting the uptrend will resume. Hidden bullish divergence occurs in a downtrend pullback where price forms a lower high, but the indicator makes a higher high, implying the downtrend will continue. Divergence is a powerful warning tool, but it should always be confirmed with other analysis techniques, as acting on it alone can lead to false signals.