Volume Divergence Indicator
MetaTrader’s Volume Divergence Indicator is a custom trading tool for identifying and trading volume divergences in asset prices.
What is Volume Divergence?
Volume divergence is an indication that prices will soon reverse due to an increase/decrease in volume. This occurs when the price changes but is not reflected in the volume. For example, a bearish volume divergence is when price creates a lower high and higher volume. Bullish volume divergence is also possible when price creates higher volume at lower highs.
What is a good divergence indicator?
Different indicators, such as MACD, RSI, etc. Price divergence can be identified by different indicators such as MACD, RSI, etc. However, the best indicator for divergence trading is the Volume Divergence indicator. This is because volume is an important factor in trading.
The Volume Divergence indicator can also be used for intraday/intra-day and swing trading. This indicator is recommended for novice, intermediate or expert Forex traders.
How to trade with the Volume Divergence Indicator
Buy or sell signals. First, identify a bullish volume divergence and then establish a buy/long position based on price action (e.g. bullish engulfment, pin bar, etc.). This principle can also be applied to sell signals.
Summary
The Volume Divergence Indicator (MT4) is a powerful technical indicator that can be used to trade price divergence of assets.
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