The emphasis should be placed on divergence because through divergence we can better handle the issue of whether the third stroke at the beginning is wave 3 or wave C.
When I make videos for you, a series of professional terms such as structural divergence often appear. Divergence is not difficult to understand!
In dynamics, divergence is actually a manifestation of strength exhaustion, and it is also reflected in the application of K-line.
The center has the same gravitational force on the entry and exit segments. The more pens that build the center, the greater the energy. The more energy a center has, the greater the gravitational force it has.
If I interpret it using gravity, people may not understand.
I introduce the lower divergence, then it will be easier to understand. In fact, the core of divergence lies in the comparison of strength.
However, there are various forms of strength comparison. According to my observation, under normal circumstances, if the third stroke diverges, it will inevitably be accompanied by a divergence of MACD. You can review the market trend to interpret it.
Divergence usually occurs at the end of wave 5 in an uptrend and at the end of wave 5 in a downtrend.
In the trend of the third stroke, assuming that the third stroke has diverged, then I will also treat it as a divergence. At the same time, the third stroke is defined as wave C, not wave 3!
However, this is not so absolute. Ultimately, we still need to refer to the exhaustion of strength and the area of the red and green energy columns in MACD.
As shown in the figure:
The trend in the picture belongs to ton. This kind of trend belongs to wave 5. The strength is strong, but the area of the column obviously does not break the previous high.
The divergence is basically complete. The next buying and selling point.