Technical Analysis
Bullish divergence trading – example 1
By OT83  •  June 25, 2011
Copy from previous post: Bullish divergence:
  • Price form lower low (A->C), MCAD histogram form higher low (a->c)
  • Must have ABC in price chart and abc in histogram chart
  • a and c below center line, b above center line
above only valid and can go long ONLY if higher time frame show bullish divergence(weekly), current time frame(daily) show bullish divergence From my process of searching through the charts to have a sample of the stringent divergence pattern as describe above in bold, I realise that it is not easy to have such chart available. Most of the time, the chart will not demonstrate ALL of the rules above. No wonder it is such a good trading opportunity once such chart are spotted. In the example below, the daily chart fulfill the abc and ABC.
However, the weekly chart does not fulfill it at all.
Stringently, the above does not ...
...
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By OT83
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