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Bullish Divergence

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Mr. Ross can you tell me exactly what is meant by "Bullish Divergence?"

It's really very simple. A Bullish Divergence occurs when prices fall to a new low while a technical indicator fails to reach a new low. This situation demonstrates that bears are losing power, and that bulls are ready to control the market again—often, but not always, a bullish divergence marks the end of a downtrend.

The technical indicator is usually a momentum indicator like Stochastics, RSI, %R, or MACD, all of which are based on detrending an EMA.

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Joe Ross

Joe Ross

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Practical Teaching Derived from over 60 Years of Trading Experience and over 30 Years of Mentoring .  Click here to learn about private mentoring with Master Trader Joe Ross.

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Guest - Earl Stallmann on Friday, 14 August 2020 12:24

Joe's bio says he's been mentoring for 27 years. I think it's at least 28. There were seven of us in a three day educational session in January of 1992. I think it was only the second of Joe's training sessions.

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Joe's bio says he's been mentoring for 27 years. I think it's at least 28. There were seven of us in a three day educational session in January of 1992. I think it was only the second of Joe's training sessions. -
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Saturday, 20 April 2024

Derivative transactions, including futures, are complex and carry a high degree of risk. They are intended for sophisticated investors and are not suitable for everyone. There are numerous other factors related to the markets in general or to the implementation of any specific trading program which cannot be fully accounted for in the preparation of hypothetical performance results, and all of which can adversely affect actual trading results. For more information, see the Risk Disclosure Statement for Futures and Options.