Klicken Sie hier, trading forex using divergence zurück zur Homepage Amazon. Due to the forex market’s complexity, it is hard to find an optimum indicator to foresee the potential development of market trends, if any such indicator exists at all.
However, forex divergence may be one of the best indicators to reveal how the market may behave in the periods to come, thereby providing the investor with the opportunity to make the best justified trading decisions. If you are interested in how to trade divergence in forex, this article is right for you. Overview of Convergence and Divergence in Forex Let’s first define the terms convergence and divergence. Convergence in forex describes a condition under which an asset’s price and the value of another asset, index or any other related item move in the same direction.
For instance, let’s assume a situation in which market prices show an uptrend, and so does our technical indicator. In this case, we face continuing momentum, and there is high probability that the trend will persist. Divergence in forex, to the contrary, describes a condition under which an asset’s price and the value of another asset, index or any other related item move in opposite directions. For instance, if we consider again a situation where market prices grow and the technical indicator’s value drops, we will face decreasing momentum, and thus signs of trend reversal. So, basically, forex divergence trading and convergence trading focus on the same tools and mechanisms and embrace the same actions performed by the trader for evaluating market dynamics.