7m 52s: Lenght

Forex Divergence strategy - Get another forex trading strategy at http://www.ForexCandlestickMagic.com Forex Divergence is a very useful way to trade. Identifying divergence correctly can help in identifying times when market may reverse. However the key is to identify the divergence correctly. Typically traders should oscillators to identify divergence. Some of the common oscillators used are MACD, Stochastic, RSI and other indicators. MACD is one of the most reliable indicators when to comes to finding divergence. When divergence is to be analysed in forex trading, there are two common forms - Positive Divergence and Negative divergence In Positive Divergence, the MACD is in upword direction and currency pair is in downward direction. For example, if the price is making lower lows but MACD is making higher highs, it is Positive divergence. Watch the video to see some examples. The opposite is true for Negative forex Divergence. In this, currency pair makes higher high for example but MACD will make lower highs. By the way, for more examples, you can also check http://www.investopedia.com In Forex Divergence strategy, once the divergence is identified, it is key to use a confirmation indicator. This confirming indicator can be chart patterns (such as double top, double bottom, head and shoulder pattern etc), forex candlestick patterns such as doji patterns, reversal patterns etc. Don't trade on Forex divergence without a confirming indicator. Otherwise the trade will be too risky. Watch the video for other precautions to be taken while using Forex Divergence as trading strategy. Also I have included some good forex divergence examples. https://www.youtube.com/watch?v=NJMRHmte0DM