What is the difference between divergence and hidden divergence in the context of cryptocurrency?

1 answers

• Dec 19, 2021 · 3 years ago
  In the context of cryptocurrency trading, divergence and hidden divergence are two key concepts that traders use to analyze price movements and make trading decisions. Divergence occurs when the price of a cryptocurrency and a technical indicator, such as the Stochastic Oscillator, move in opposite directions. This can indicate a potential reversal or a weakening of the current trend. On the other hand, hidden divergence occurs when the price and the indicator move in the same direction, but with different momentum. This can suggest a continuation of the current trend. Traders use these concepts to identify potential buying or selling opportunities and to confirm or invalidate their trading strategies. It's worth noting that these concepts are not unique to cryptocurrency trading and can be applied to other financial markets as well.
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