Premium Divergence

WHAT IS IT?

Divergence analysis identifies discrepancies between price action and oscillator behavior. When price makes a new low but an oscillator makes a higher low, a potential bullish reversal is signaled (regular divergence). When price makes a higher low while the oscillator makes a lower low, trend continuation is signaled (hidden divergence). Manually scanning multiple indicators for divergences simultaneously is impractical in live trading.

INDICATOR PRIME IMPROVEMENTS

Premium Divergence scans nine internal oscillators simultaneously: RSI, MACD, MACD histogram, Stochastic, CCI, Momentum, OBV, CMF, and MFI. Each oscillator is checked independently for both regular and hidden divergences. A confidence score (1-9) reflects how many oscillators agree on the same divergence. Signals are color-coded by confidence: EXCELLENT (5+ agreements), HIGH (3+), NORMAL (1-2). Additional filters include 200 EMA direction, ADX chop detection, volume confirmation, multi-timeframe RSI confluence, minimum score threshold, and a cooldown to prevent overlapping signals.

HOW TO USE

Set the minimum score to 2 for balanced signal quality. EXCELLENT-rated divergences (5+ oscillators confirming) are the rarest and highest-conviction reversal setups. Regular divergences signal potential trend reversals at price extremes; hidden divergences signal trend continuation after pullbacks. The VOL and MTF tags add volume and higher-timeframe RSI backing to each signal.

KIT CONFLUENCE

Premium Divergence is the multi-oscillator confirmation engine of the kit. Combine with Smart RSI: an oversold RSI reading combined with a HIGH or EXCELLENT Premium Divergence signal creates both level-based and divergence-based confirmation simultaneously. Master A/D divergences aligning with a Premium Divergence signal create a volume-flow plus momentum-divergence setup.