What is Regular Divergence?
Regular divergence is often seen as a clue that a trend reversal might be on the horizon.
There are two types of regular divergence:
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Bullish Divergence
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Bearish Divergence
🔼 Regular Bullish Divergence
This occurs when price forms lower lows (LL) but the oscillator forms higher lows (HL).
It typically shows up at the end of a downtrend.
Here’s the idea:
If price makes a second low but your oscillator doesn’t follow — meaning momentum didn’t make a new low — that’s a sign the selling pressure may be fading. And when price and momentum no longer agree, a reversal to the upside could be coming.
Check out the chart below to see what regular bullish divergence looks like.
🔽 Regular Bearish Divergence
This is the opposite scenario.
If price is making higher highs (HH) but the oscillator is making lower highs (LH), you’ve got a regular bearish divergence.
This usually happens during an uptrend.
When the price pushes up for a second high but the oscillator doesn't confirm it with its own higher high, that’s your red flag. Momentum is weakening, and a reversal to the downside might be just around the corner.
See the example chart below showing how the price drops after forming that second top.
When to Use Regular Divergence
As the images show, regular divergence is most helpful when trying to spot market tops and bottoms.
You’re basically looking for moments where the current trend is about to run out of steam and reverse.
The oscillator acts as your early warning system — even if price makes a fresh high or low, a divergence in momentum suggests that move may not last.
Now that you’ve wrapped your head around regular divergence, it’s time to level up and learn about the second kind: hidden divergence.
No worries — it’s not as mysterious as it sounds (this isn’t the Chamber of Secrets 😄). It’s just called “hidden” because it occurs within the trend rather than at the turning point.
We’ll break it down in the next section. Let’s keep going! 🚀