MACD Divergence - ForexAbode.com
MACD Divergence: MACD divergence is when MACD is not in confirmation to the price action. Simply speaking lets say the price is going down and there is new recent low but the cooresponding MACD does not make a new low but the corresponding lower point of MACD is higher than the previos low then it is divergence.
To summarize:
1) Price action has a new low (price lower than the previous lows)
2) MACD's corresponding low is not lower than the MACD's previous low but this current low is higher than the previous low.
MACD Positive Divergence:
The above example is of positive divergence when the low of MACD is higher that its previous low but the low of the price action is lower than the previous low price.
MACD Negative Divergence:
1) Price action has a higher high but the corresponding MACD high is lower than the previous high
