Bullish Divergence

Bullish Divergence

In technical analysis, a situation in which the price of a security goes to a new low while another indicator shows the trend is likely to reverse. That is, bullish divergence occurs when a bullish indicator shows a bearish sign (the new low) is unlikely to be true. This is a bullish sign. Technical analysts use a number of factors to attempt to observe divergence and make investment decisions accordingly. See also: MACD.