Divergence--untamed beast or man's best friend?

invaliduser:

Any favorite patterns you look for?

Agreed, without some form of confirmation, it can be a bit like catching a falling knife.

Pat
 
Quote from thruline:



Agreed, without some form of confirmation, it can be a bit like catching a falling knife.
More...

More like getting your throat slit... :(

Dude, you gotta pretty up those charts a little. How are you taking
pics of them and posting them into ET?
 
I have a couple of charts I would like to share but have no clue in how to take a pic and post it directly into the thread so people don't have to open a file.

Any ideas ?

Thanks.
 
The attached file shows a very clear buy signal. As the market rallies to the pivot line, it indicator shows weakness before it stalls out there.
 

Attachments

Eewh, ugly ugly charts. Ugly. I honestly beleive, there is a conspiracy of shitty software out there, to cut through the profits and skill of traders around the globe. Hey, if you disagree-but all my google surfing suggests "divergence" is one of the hardest things to actually program a computer to recognise, period.
How can this be?
 
:D

LOL. Maybe the Ugly charts helps the man concentrate on the "game" rather than admiring his charting software.

PS. I don't like the eSignal LAF either.
 
Quote from acronym:

Eewh, ugly ugly charts. Ugly. I honestly beleive, there is a conspiracy of shitty software out there, to cut through the profits and skill of traders around the globe. Hey, if you disagree-but all my google surfing suggests "divergence" is one of the hardest things to actually program a computer to recognise, period.
How can this be?
More...

The recognition of any divergence is relatively easy and fast.
The only thing you need is a clear, unambiguous definition. The rest is trivial. You may have a look at my divergence codes in
http://www.amibroker.com/library/list.php
for more details.
 
Quote from thruline:

I've been using divergence to assist reliably in trading decisions. I'm hoping there's sufficient interest here to develop strategies, debate use--when, how, if--to use both regular and reverse (hidden) divergence as part of a profitable method.

In the attached chart, there are five pairs, each made up of a yellow line and a black arrow. Pair #1 show price rising with indicator flattening. It warns of possible pause or change in trend. Pair #3 shows a double top with a downsloping indicator. Pair #4 confirms likely sell-off with rising price countered by down sloping indicator on higher time frame. Sell at point 4.

Pair #2 shows upsloping indicator despite lower low in price. At the same time, pair #5 shows price making higher lows while indicator is flat. This reverse divergence on higher time frame complements regular divergence on lower time frame and provides a high probability entry.

Using several time frames to confirm in these ways greatly enhances the likelihood of an accurate analysis and a profitable trade, provided the divergence is a part of a complete trading plan.

Any thoughts, methods that others wish to share are welcomed.

Pat
More...

I used the MACD and/or stochastic divergence for light crude oil futures over the last 5 years. The story is ALWAYS the same...
The last example was a net +40% and it was not bad at all !!
 

Attachments

You must log in or register to reply here.
Back
Top