Show me how you would do Trading Divergences on this chart

Tell me how to do Trading Divergences

On this chart

Chart EURUSD, M30, 2013.10.26 14:47 UTC, IBFX, Inc., MetaTrader 4, Demo - MetaTrader Trading Platform Screenshots

sell signal, the divergence on the most recent candlestick wave pattern and stoch oscillator is saying that. but the thing lies with the little hook of the stoch which can still change, which will distort the divergence.

any experts out there has anything to add? :50:

I’m no expert here but where’s the trend ?? Sorry, I only see consolidation.

Correct me if i’m wrong, but Divergent moves have a much higher probability of success when there is a trend present (…a fact which quite a lot of people ignore…)!

this is only a 30min chart, you need 4 hour chart to see the trend. no…?:8:

That’s a range.
You better use divergence to fade a trend. Even in trends divergences are not a clear sign of trend reversal. In ranges they occur very often.

To Krafty, in my opinion, but I might be wrong, divergencies are not that kind of indicators that need confirmation to an upper timeframe. I suspect they are only good to describe the trend you are seeing in the timeframe where the trend is. If there is no trend in the current TF but there is in an higher TF, then search for divergencies in the last one.

Krafty, I’m afraid I will have to agree with aguy.

Also wanted to add that divergence theory should only be one part of a whole. To increase our chances of success we have to also include other equally important confluent signals. It is nothing new & I think pretty much standard way of trading price action… I’m sure the PA experts on this forum will be able to explain it much better.

Just to give you a simple example, this is how I might theoretically use other ideas to back up a divergence signal:


Note the hidden divergence coupled with important S/R level at 1.3500 (also round number) & 50% fibo reading within a general uptrend. This would have given me a greater conviction to take a Buy trade around that level.

good luck.

Hey man! If you need to review divergence trading, here’s a lesson on the School of Pipsology that might help: High School - School of Pipsology - BabyPips.com

hi aguy, what do you mean fade a trend? thks in adv.

When a trend is “old” and you see several divergencies, and when at the top of the trend prices looks like consolidate, and its near a SR level, you could start to consider the trend is over. Usually it wont return like a bullet, it is fading. Then is the moment to start thinking about a reversal. I call it “to fade” the trend to differenciate from the situation in which the trend reverses brutally. It’s a slow transition. By “old” I meant you already have seen three to five retracements.

thanks pal, very clear explanation. cheers…:59:

Maybe I am missing something here, but why would I (or anyone else) show you how we would trade? I think you should figure that out yourself as that is the only way to learn.

cos’ we are not selfish pigs…:5:

also, it’s good to learn from one another than to keep your learning which may be wrong or take too long to figure out.

Think as you like about it, has nothing to do with being selfish but if you prefer to call people pigs who don’t share their work with you go for it. What you guys are doing is like two blind people giving each other directions, but as long as you feel this is helping you keep doing it. The way the question was asked says it all.

And still, everyone needs a spark to light that curiosity inside that would make him research alone.

we’d know if someone is faking their replies, all it takes is few demo trades, we shall be able to verify.:stuck_out_tongue:

It’s ranging IMO. The divergences that work in my recent charts are the ones that have more than two points to connect.

i have a question, if say 15M and 30M chart show sell where 1 hour and 4 hour show buy, what will you do??? thanks!

If I’m day trading I’ll sell using the 15m chart then set my targets with the 1h and 4h levels in mind. If I’m swing trading I’ll ignore 15m and 30m charts and buy. That’s just me lol.