MACD Sees Through the Main Force's Washing Plate Scam
🟧Divergence Phenomenon
1/Bullish Divergence
During the process of a price drop, if the price of the coin makes a new low but the MACD indicator's DIF line or MACD histogram does not sync with the new low, this is a bullish divergence. This often means that the downward trend of the coin price is about to end, and the main force may be conducting a final wash by suppressing the coin price.
For example, if the price drops from 10 yuan all the way to 8 yuan, then to 7 yuan, continuously making new lows, but at this point the MACD's DIF line rises from -0.5 to -0.3, a bullish divergence occurs. This indicates that although the coin price is dropping, the momentum of the decline is weakening, suggesting that the main force may be secretly accumulating, and subsequently, the coin price is likely to reverse and enter a major uptrend.
2/Bearish Divergence
During the process of a price increase, if the price of the coin makes a new high, but the MACD indicator's DIF line or MACD histogram does not sync with the new high, this is a bearish divergence.
However, during the wash operation before a major uptrend, the main force may create a temporary illusion of bearish divergence. At this point, it is necessary to combine the position of the coin price and other indicators for a comprehensive judgment.
If the coin price appears to have a seemingly bearish divergence at a relatively low position, but the trading volume does not show significant signs of large selling, and other technical indicators do not have obvious sell signals, then this may be a method of the main force's wash, aimed at intimidating those investors who do not have comprehensive technical analysis. #