Is a normal divergence a reversal or just a pullback?

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Is a normal divergence a reversal or just a pullback?

Konstantinos_Gailas Discussion started by Konstantinos_Gailas 6 months ago

Hello everyone,

I wanted to start a new discussion about the normal divergences if i may, because i want to know what are the criteria for a normal divergence to be an indication for an upcoming reversal.

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Konstantinos_Gailas CoffeeShopCrypto believe me i know 😬 6 months ago

nighttalker I use the Heiken Ashi Algo to take note of divergences and use them as confluence, but for the reasons E stated above, I don't jump into trades just... Show more 6 months ago

Konstantinos_Gailas nighttalker glad to hear that 😀 6 months ago

roxxi Divergence to me in view of "is it a a bird or is it superman"?? aka....is it a pullback or is it a reversal. I struggled with this concept. My... Show more 4 weeks ago

Divergence to me in view of "is it a a bird or is it superman"?? aka ....is it a pullback or is it a reversal. I struggled with this concept. My resolve so far is that it all depends on the timeframe one trades. I particularly use 2 major ema's in the form of ema200 and ema800. I also use minor ema's, namely 5 9 30 50. (30 is a wma30, the rest are ema's). Let say I am trading the 1 minute chart. Essentially if the ema200 is above 800, so will all the minor ema's. Therefore PA is in a rally and pushing up making waves in the form of higher highs and higher lows.   During the rally transition, Price Action will make "pullbacks" Pullbacks for me represent PA pulling to the minor emas or even to test the ema200 to REFUEL, then continue its trajectory.  Those for me are "PULLBACKS" ,,,,, The fact that PA continues to push higher after pulling back to test minor ema's or a test and bounce off ema200 or ema800 remain under the "PULLBACK" category.   I start to consider that a REVERSAL is in play when I see the minor ema's start to cross the other side of ema200 with  PA holding true to now making lower lows and lower highs...   However, this can quickly turn to being a fake out..... WHY, because PA can show and intention to REVERSE, but a fundemental news release could revert PA to its former trajectory which in this example was BULLISH.  It is when ema200 closes past ema800 and PA holds ema200 below ema800 and PA starts to break market structure once 200ema is comfortably below ema800 that I consider that we are now in REVERSAL...... This example is my own personal resolve.  Others may view pullback and reversal differently... hopefully this helps to clarify my approach to defining pullback versus reversal.

roxxi Sorry I forgot to include the divergence factor. Basically, I seek to find divergence off a higher timeframe (say D1 or H4), then I do a top-down... Show more 4 weeks ago

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Is a normal divergence a reversal or just a pullback?

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