OBV Divergence Indicator

OBV Divergence Indicator

OBV Divergence offers highly profitable forex divergence buy-sell signals for MT4 users. Best for automatic technical support on divergence setups. Suits MTF Charts

Categories: Trend, MT4, Signal

The OBV Divergence is an automatic On Balance Volume divergences indicator. It demonstrates both classic and hidden divergence signals on forex MT4 charts.

The Divergence is an advanced trading method that mostly suits intermediate and expert level traders. For beginners, it might be crucial to identify the irregularities between price and volume movements consistently. So, an auto divergence detector can always be a handy tool for amateurs and busy traders, allowing them to try this famous forex trading technique.

The OBV Divergence indicator sharply spots the opposite behaviors between price and on-balance volume changes. Thankfully, you don’t need to distinguish between the bullish and bearish divergences by yourself. This indicator uses arrow signals to confirm whether it is a bullish or bearish divergence. So, you only need to respond to the indicator’s trade alert and follow the arrow’s direction for placing a divergence-based trade entry.

How to trade forex divergences using the OBV Divergence indicator in MT4?

The OBV Divergence Indicator strictly follows the regular and hidden divergence rules for anticipating trading opportunities.

In the above chart, the indicator has captured three divergence setups. In the first setup, the price makes a lower high while the OBV creates a new high. According to the hidden divergence rule, it is a sell signal. The arrow at the top of the indicator window points downwards to signal an upcoming bearish trend.

The second setup shows a different scenario. Here, the price makes a higher high when the indicator plots a lower high. It is another sell signal based on regular or classic divergence rules.

Finally, the price creates a higher low in the third setup, while the OBV makes a lower low. It is a hidden divergence signal suggesting the price is preparing for a bullish trend move.

Conclusion
Divergence trading is one of the most effective techniques for determining forex buy-sell signals. Besides OBV, other indicators like RSI, Stochastics, and MACD are also popular in identifying the divergence setups. However, On Balance Volume gives you the best insight into the future trend direction. Besides, the OBV Divergence indicator distinctly shows unsymmetrical price movements, making divergence trading more convenient for beginner-level traders