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Analysis

Divergence — definition & meaning

When price and an indicator move in opposite directions.

Divergence occurs when price makes a new high or low but an indicator like RSI or MACD does not confirm it, hinting that momentum is fading.

Bullish divergence (price lower low, indicator higher low) can precede a bounce; bearish divergence the opposite. Divergence is an early warning, not a precise timing signal, and it can persist for a while before price responds.

The information on Trding.io is for general information only and is not investment advice. Trading involves a real risk of losing money, and most retail traders lose. Never trade money you cannot afford to lose.

Related terms

Relative strength index (RSI)
A momentum oscillator from 0–100 gauging overbought and oversold conditions.
MACD
A trend-and-momentum indicator built from two moving averages.
Stochastic oscillator
A momentum tool comparing the close to a recent high-low range.
Momentum
The speed and strength behind a price move.
Volatility
How much and how quickly a price moves over time.
Volume
The number of units traded over a period — a gauge of activity.

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