Divergences are defined as opposite signs in the returns of the assets in a timeframe of interest as follows:
R1 is the return of asset 1 and R2 is the return of asset 2. A divergence occurs when R1 × R2 < 0
We start with S&P 500 and Dow 30 indexes due to a divergence last week, with the former rising 1.6%, and the latter falling -0.2%.
Access the full report with a Premium Articles or All-in-One subscription. 10% off all premium content with Discount Code NOW10.
By subscribing you have immediate access to hundreds of articles. Premium Insights subscribers have immediate access to more than a hundred articles and All in One subscribers have access to all premium articles, books, premium insights, and market signals content.
Subscribe for free notifications of new posts and updates from the Price Action Lab Blog and receive a PDF of the book “Profitability and Systematic Trading” (Wiley, 2008) free of charge.
Specific disclaimer: This report includes charts that may reference price target levels determined by technical and/or quantitative analysis. No charts will be updated if market condition changes affect the charts’ levels and/or any analysis based on them. All charts in this report are for informational purposes only. See the disclaimer for more information.
Disclaimer: No part of the analysis in this blog constitutes a trade recommendation. The past performance of any trading system or methodology is not necessarily indicative of future results. Read the full disclaimer here.
Charting and backtesting program: Amibroker. Data provider: Norgate Data