Wednesday, 29 June 2011

Bullish divergence example 2

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



This time round I draw an additional "one" line. If you compare the histogram this "one" line with "a" and "c", the selling pressure ease. Line abc demonstrated divergence. If we add in the support line of 1.86, a good buy will be 1.86 at time of line c which is around slightly more than mid march.


la papillion said...

Hi OT,

This is a valid and good example.

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