Momentum Divergence Indicator

Momentum Divergence Indicator

Spot accurate buy-sell signals using the best Momentum Divergence MT4 indicator. Delivers automatic trend reversal alert on MTF charts for forex & stock trading.

Categories: Trend, MT4, Signal, Oscillator

The Momentum Divergence is an MT4 trend reversal indicator. It intensely monitors the changes in price-actions and detects accurate divergence buy-sell signals. Divergence is one of the most effective ways of determining precise price swing levels. Technical traders generally apply momentum indicators to spot irregular price movements. It helps them to anticipate precise divergence signals. MACD and RSI are well-known for assessing potential divergence setups.

However, with the development of upgraded MT4 indicators, there is always room to improve your trading strategy of picking the best trade signal. While reviewing the momentum divergence, we’ve found the indicator super fast in adapting to MTF charts. Also, it automatically filters weak divergence setups and shows highly probable trading signals.

Furthermore, the Momentum Divergence demonstrates detailed information alongside potential signals. For instance, the red/green arrow tells you whether it is a bullish or bearish trend reversal. Also, the automatic trendline on the main chart and the indicator window shows how the divergence has formed.

After reading this guide, you’ll learn how to trade forex and stocks consistently using the Momentum Divergence indicator for MT4.

How to determine potential buy-sell signals using the Momentum Divergence Indicator in MT4

The Momentum Divergence draws automatic trend lines in the main chart and indicator window to highlight the potential divergence setup. Besides, it includes green/red arrows to signal the next possible direction of upcoming price movements.

Technically, the indicator follows the fundamental rule of divergence for generating buy/sell signals. For instance, the price plots a lower low, and the indicator level creating a higher low means a bullish divergence. Conversely, when the price drops from a higher high and the indicator level make a lower high, it signals a bearish divergence.

The above EURUSD chart shows how the Momentum Divergence indicator works on MT4 charts. Initially, the price went bearish when it created a lower low. Next, the indicator line made a higher low, indicating a bullish divergence. The automated trendlines show how the indicator spotted the setup as a bullish trend reversal signal. The tiny green arrow below the indicator level signals a buy confirmation.

We decided to exit the buy order when the indicator spotted a bearish divergence signal. Nevertheless, waiting for an opposite signal to close a trading position may involve the risk of a late exit. Therefore, consider an immediate exit after the trade hits your pre-determined profit target.

Conclusion
The Momentum Divergence is the best MT4 indicator for counter-trend trading in forex and stocks. Besides showing bullish/bearish divergence signals, it also plots automatic trend lines showing how the divergence has formed. It helps beginners to understand the basic rules of confirming trend-reversal positions. Also, It enables you to track the long-term changes in market trends and spot profitable buy-sell opportunities.