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OVERVIEW OF CONVERGENCE AND DIVERGENCE IN FOREXfirst define the terms convergence and divergence. let´s goConvergence in forex describes a condition under which an asset's price and the value of another asset, index or any other related item move in the same direction. For instance, let's assume a situation in which market prices show an uptrend, and so does our technical indicator. In this case, we face continuing momentum, and there is high probability that the trend will persist. So, here, the price and the technical indicator converge (i.e. follow the same direction), and the trader may refrain from sale, as the price is likely to further grow.Divergence in forex, to the contrary, describes a condition under which an asset's price and the value of another asset, index or any other related item move in opposite directions. For instance, if we consider again a situation where market prices grow and the technical indicator's value drops, we will face decreasing momentum, and thus signs of trend reversal. The price and the technical indicator diverge, and therefore the trader may opt for running sale for procuring the highest profit.So, basically, forex divergence trading and conv…
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Sebine avatar
Sebine 22 Feb.

Good article!

marcellogyn avatar

thanks Sebine

ForexAlyoum avatar

i like divergence so much , but what is the last indicator ?

marcellogyn avatar

this last image uses a paid indicator .. is not in the session indicators of mt4..

Lovely_bee avatar

good job )

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  • introduction
chaque trader a sa propre manier de trading . certains utulise le price behavior et autre utulise les candle et la plus part utulise les indicateur technique .. dans cette article je veux presente l un de ces indicateur et j utulise personnelment .

Proposé par J. Welles Wilder1 en 1978, le RSI (Relative Strength Index) est un indicateur avancé d'analyse technique. Utilisé conjointement à l'analyse de la tendance, il a vocation à :
  • repérer la puissance d'un mouvement (indiquer si le mouvement s'essouffle);
  • indiquer si l'on est en situation de sur-achat ou de sur-vente.
2 - Formule de calcul du RSI
La formule de rsi s ecrit : RSI = (H/(H+B))*100
avec :
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NikaTigra avatar
NikaTigra 15 Apr.


gargantua avatar
gargantua 21 Apr.

good article

AnnaZhurina avatar

Very good !!!

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The more frequent opportunities arise, the more it describes the uneven pricing of currencies patterns. The arbitrage strategy may cause an investor to be stuck with his work in foreign exchange and earn profits because of pricing inefficiencies. Basically, it is a scenario which is described by the issues of disequilibrium in the pricing strategies. Because of over or under pricing, some events are not in favor of traders. Investors usually try to take a backup tire to remain safe from contingent events. Triangular arbitrage or three-point arbitrage is a widespread practice being implemented in the foreign exchange trading market. This is a systematic way towards triangular arbitrage. The process of triangular arbitrage is really ordered and even a small jumble can cause it to leave its boundaries of triangular arbitrage since it may be considered as a sensitive phenomenon. The triangular arbitrage strategy involves the following steps: 1) Investing Currency A in to Currency B 2) Investing Currency B in to Currency C 3) Again investing the currency C back in to currency A In this Figure, we can see one example where the investor has $1,000,000. Currency A is USD Currency B is CA…
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robsmyth avatar
robsmyth 2 Nov.

What do you think about arbitrage strategy for EURJPY and GBPJPY pairs ? Is this nice shot for today trading?

nhuloan avatar
nhuloan 6 Nov.


Cesar avatar
Cesar 8 Nov.

nice article

marrkuss avatar
marrkuss 28 Feb.

Dobar dan Igor
where do you get the indicator and can it be used for mt4?

campione avatar
campione 26 May

Hiya, Where is the indicator+workspaceTemplate to download? Tnx

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The Moving average convergence divergence (MACD) indicator, which was fist created by Gerald Appel in 1960s (DailyForex,2012), has been classified as a momentum indicator and is a valuable and popular implement for Forex traders. MACD shows the relationship between moving averages of two different prices and is calculated by deducting the 26-day exponential moving average (EMA) from the 12-day exponential moving average (EMA) which Closing prices are used for these moving averages. In addition, a 9-day EMA of the MACD Line acts as a signal line and identifies turns. MACD can be applied to daily, weekly, or monthly Forex charts (investopedia, 2012) The MACD Histogram represents the difference between MACD and its 9-day EMA, the Signal line. The histogram is positive when the MACD Line is above its Signal line and negative when the MACD Line is below its Signal line. This indicator can be formulated as following: MACD = Short Term EMA - Long Term EMA MACD Line: (12 day EMA) – (26 day EMA) Signal Line: 9-day EMA of MACD Line MACD Histogram: MACD Line - Signal Line There are four general methods used to interpret the MACD as following: 1. Signal Line Crossovers Signal l…
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scramble avatar
scramble 14 Sep.

I used a lot this indicator in the past. You exposed it very well! Well done!

captain avatar
captain 24 Sep.

As is the case with most oscillators, MACD is best used in the context of prevailing trend.

alifari avatar
alifari 24 Sep.

MACD is a powerful indicator, if used in conjunction with support/resistance & supply/demand

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