✍ Relative Strength Index (RSI) and Positive Divergence:
When monitoring market movement, we may sometimes notice that the price continues to decline, but the Relative Strength Index (RSI) starts to rise. This is known as positive divergence.
This typically occurs during downward trends and means that selling pressure has begun to weaken, despite the continued drop in price. This weakening in selling momentum can be a signal that the market may soon reverse to an upward direction, or at least we may witness a temporary price increase (upward correction).
✍️ In short: Positive divergence in RSI suggests a possibility of halting the decline and starting a temporary rise or a complete reversal in direction.