Divergences are the most powerful and precise element of technical analysis after support and resistance levels. Obviously, like everything in the markets, divergences do not always work; but they work at least 80% of the time. And this is a success rate that is much higher than anything else I know in working with charts.

✅ Bullish Divergence

Occurs when the indicator makes higher lows, while the price makes lower lows. The outcome is that the price rises, as predicted by the indicator.

✅ Bearish Divergence

Occurs when the indicator makes lower highs, even though the price shows higher highs. The result is a price that falls, as the indicator had announced.