Scalping divergences

💎 Scalping divergences 💎

This is how I trade divergences

I like to keep it simple and only focus on divergences around levels. Basically to confirm if levels are respected or not.

Divergences

Divergences are for me a second confirmation since they happen after a price move. The first impulse has already happened and if the second impulse is weaker than the first one, and the price makes a lower low or higher high, we get a divergence. Basically, we know that the momentum is declining for the current move.

Declining momentum

Declining momentum around a key level can be a strong sign of reversal. Hence I use divergence to confirm that momentum shifts around these kinds of levels

Example

The graph below shows how the Bullish Divergences confirmed that the Demand Zone and Day Open level were respected and the momentum for the negative move was declining around the zone.