Types of Divergence Commodity Trading

Types of Divergence Commodity Trading Definition - Divergence is a commodity setup used by Commodities traders - divergence commodity involves looking at a commodity chart and a commodity indicator - for example MACD indicator.

To find this divergence commodity setup find 2 chart points which commodities price makes a new swing high or a new swing low but the MACD indicator does not do the same, this commodity signals a divergence between commodities price & MACD technical indicator momentum.

For a divergence commodity setup we look for 2 chart points, two highs which form an M shape on the commodities trading chart or two lows that form a W Shape on commodities trading chart. Then look for the same M shape or WShape on the Commodity Trading MACD indicator.

Example of a Divergence Commodity Trade Setup:

In the commodity chart below we spot two chart points, point A & point B (swing highs). These 2 commodity chart points form an M shape on the commodities price chart.

Then using commodity trading MACD technical indicator we check highs made by MACD commodities technical technical indicator, these are highs which are directly below Chart points marked A and B.

We then draw one line on the commodities trading chart & another line on the MACD technical indicator.

Divergence Commodity Signals - Types of Divergence Commodity Trading Definition - Types of Divergence Commodity Trading Definition

The commodity chart above shows example of hidden bearish divergence commodity trading setup.

hat is Divergence Commodities Types of Divergence Commodities

In order to trade divergence commodity trading signal we look for the following:

• HH : Higher High - two highs but the last one is higher
• LH : Lower High - two highs but the last one is lower
• HL : Higher Low - two lows but the last one is higher
• LL : Lower Low - two lows but the last one is lower

Divergence Commodities Terms Definition: Different Types of Divergence Commodities Trading - Types of Divergence Commodities

M shapes on Commodities charts dealing with Commodity price Highs

W Shapes on Commodities charts dealing with Commodity price lows

Example of M Shapes on Commodities Charts - Types of Bearish Divergence Commodities

Examples of W Shapes on Commodities Charts - Types of Bearish Divergence Commodities

Different Types of Divergence Commodities Trading - Types of Divergence Commodity Trading - Types of Bearish Divergence Commodities Trading - Types of Bullish Divergence Commodities Trading - Types of Divergence Commodity Trading Definition - Types of Divergence Commodity Trading Definition