What's this have to do with trading. Well, If you wanted to long, probably not a good entry point. If your Holding a Short good signal to keep the slide ride onboard.
It is a signal that a continued downtrend is more likely. I'd have to suggest that most likely the next lower low will carry the diversion signal. Which doesn't mean the downtrend ends, it means that the pump up is of a greater percentage price movement 4% - 8%. The downtrend could end or just bounce and continue. That would need to be evaluated at the time in the future.
It is a signal that a continued downtrend is more likely. I'd have to suggest that most likely the next lower low will carry the diversion signal. Which doesn't mean the downtrend ends, it means that the pump up is of a greater percentage price movement 4% - 8%. The downtrend could end or just bounce and continue. That would need to be evaluated at the time in the future.