RSI Divergence

RSI divergence can be a very powerful indicator. The combination of divergence and the right signal can improve the chances of winning trades. Beth will measure the most recent High/Low against whether that High/Low had a stronger RSI. If not, then she will announce a divergence situation.

For example, suppose the market is falling and after a brief retracement reached a new Low. If that new Low is matched by a new Low in RSI, then nothing will be announced. However, if that new Low was not matched by a lower RSI, then a divergence condition exists, and Beth will speak and say, "RSI bullish divergence." Optionally, she will also announce the chart that is showing the divergence.