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Type of Divergence

Identification

 

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Classic Bearish

HH price

LH indicator

Indicates underlying weakness

Warning of a possible short- to intermediate-term change in trend from up to down

Classic Bullish

LL price

HL indicator

Indicates underlying strength

Warning of a possible short- to intermediate-term change in trend from down to up

Bearish Hidden

LH price

HH indicator

Indicates underlying weakness

Mainly found during corrective rallies in a downtrend

May also occur during retests of a price top

Bullish Hidden

HL price

LL indicator

Indicates underlying strength

Good entry or re-entry

Occurs mainly during corrective declines in an uptrend

May be found on occasion at price retests of the lows

*HH=Higher High

*LH=Lower High

*LL=Lower Low

*HL=Higher Low