Volume Divergence Indicator

The volume divergence indicator used by MetaTrader is a customized trading tool that is equipped to detect and trade the volume divergence that occurs in the value of an investment.

What is the definition of volume divergence?

The presence of a divergence in volume suggests a possible price reversal because of an increase or decrease in volume. It happens when the price changes and doesn’t show in volume. For example, a bearish volume divergence is when a price makes lower highs accompanied by higher volumes. Similar to the bullish volume divergence that happens when prices create higher highs despite lower volumes,.

Is there a reliable indicator to indicate divergence?

Different indicators, like MACD, RSI, etc., are used to detect any divergence in the price. The most effective indicator to determine divergence in trading would be the volume divergence indicator, as volume is a crucial element in trading.

In addition The volume divergence indicator is ideal for trading strategies such as scalping, day/intraday trading, and swing trading. It is recommended for beginners, intermediate, and experienced forex traders.

How to Trade with the Indicator of Volume Divergence

The screenshot above shows the way that the indicator will appear on a chart for MT4. It also shows how to spot the presence of volume divergence. Additionally, it is suggested that this volume divergence indicator be used in conjunction with price action and other indicators of technical quality to ensure optimal trade entry.

SELL and BUY Signs If you want to get a buy signal, start by finding a divergence in volume that is bullish, and then open the buy/long market in accordance with price movement (e.g., bullish engulfing, pin bar, etc.). This principle is suitable for a sell signal.

Conclusion

The volume divergence indicator that is available for MT4 is a highly effective indicator of technical quality for trading the price fluctuation of an investment. It is also completely free to download.