MACD Gold Classic Bullish and Bearish Divergence

MACD Gold Classic divergence pattern is used as a possible sign for a trend reversal. MACD classic divergence is used when looking for an area where xauusd trading price could reverse and start going in the opposite trend direction. For this reason MACD classic divergence is used as a low risk entry method and also as an accurate way of exit out of a trade.

1. It's a low risk technique to sell near the xauusd market tops or buy near the xauusd market bottom, this makes the risk on your trades are very small relative to the potential reward.

2. It's used to predict the optimum zone at which to exit a trade.

There are two different types of Gold Classic Divergence:

1. Gold Trading Classic Bullish Divergence
2. Gold Trading Classic Bearish Divergence

XAUUSD Classic Bullish Divergence in XAUUSD Trading

Classic bullish divergence in gold trading occurs when price is forming lower lows ( LL ), but the oscillator is forming higher lows (HL).

MACD Gold Classic Bullish Divergence in Gold Trading - MACD Divergence Strategy

Classic bullish divergence in gold trading warns of a possible change in the trend from down to up. This is because even though the xauusd price went lower the volume of sellers that pushed the xauusd trading price lower was less as shown by the MACD indicator. This demonstrates underlying weakness of the down ward trend.

Classic bearish divergence in XAUUSD Trading

Classic bearish divergence in gold trading occurs when price is showing a higher high ( HH ), but the oscillator is lower high (LH).

MACD Gold Trading Classic Bearish Divergence in Gold Trading - MACD Divergence Strategy

Classic bearish divergence warns of a possible change in market trend from up to down. This is because even though the xauusd trading price went higher the volume of buyers who pushed the xauusd trading price higher was less as shown by the MACD indicator. This demonstrates underlying weakness of the upwards trend.