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Destroying A Myth About Divergences

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AMEX:SPY   SPDR S&P 500 ETF TRUST
We are taught that divergences exist but we are taught they are not tradeable to a high degree of accuracey.

This is WRONG.

When price tells you one thing but all your other indicators are telling you something different, pay attention.

It is a clear sign that we are flying on fumes and this plane needs to refuel lower.

Below is just ONE divergence I commonly speak to, which is volume + price.

Look at this formula.

Price Up + Volume Up = Bullish
Price Down + Volume Up = Bearish
Price Up + Volume Down = Bearish
Price Down + Volume Down = Bullish


Does it mean price will immediately reverse and go in the opposite direction 50%?

NO.

But what it does mean is that there is going to be a reversion to the mean, a pullback to balance.

You must learn the different divergences and the price patterns that are created because of those divergences if you want to consistently profit in trading.

Take control of your trading and become a trading Ninja today!
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