Divergences

Classic price/RSI divergences, found on RSI pivots:

• L-DIV: price makes a lower low while RSI makes a higher low. Selling pressure is fading.
• S-DIV: price makes a higher high while RSI makes a lower high.

The delay is built in

A pivot is confirmed by its "shoulders": a number of bars on the left and on the right must be weaker than the extreme. The right shoulder means the pivot is confirmed later than the extreme itself, so the label appears on the confirmation bar, R bars after the actual high or low.

The label sits where the signal was really available. On history it can look late. That's honest: drawing it back on the pivot bar would show a signal you couldn't have had at the time.

How it's calculated

The indicator looks for pivots on its own RSI series. L-DIV fires when a new RSI pivot low is higher than the previous one while price made a lower low, and the pivot bar closed past the lower zone edge. S-DIV is the mirror: a lower RSI pivot high, a higher high in price, and the pivot bar closed past the upper edge. The signal has to pass the anti-spam.

The zone check uses the close of the pivot bar, not the current bar. A divergence counts only if the pivot itself happened at the channel edge.

With Auto RSI period and pivot bars on (the default), the RSI period and the number of pivot bars are picked for the chart's timeframe, with the same number of bars on the left and on the right. Fast timeframes get fewer pivot bars and an earlier label; the daily chart gets more bars and a longer RSI.

More pivot bars: a more reliable pivot and a longer delay before the label.

Divergence is a CONSENSUS component, on by default. This RSI is a separate series and doesn't depend on RSI period manual of the RSI signals group.

Settings

Group 🔀 Divergences.