What is volume divergence: most helpful tool to spot trend change

Volume divergence tells us with anticipation a possible trend change. You cannot use volume divergence alone and trade only according to that but together with chart setup up and tape it’s a very useful indicator.

In the picture below, you can see an example on BLIN 3mins chart.

You see the first 2 peaks(circles) with higher volume and chart higher highs, the third peak instead has a higher high with lower volume = that lower volume tells us that the greed of getting long is getting weaker and that probably demand is getting to a shift.

blin 3mins.png

Another example on GEMP on 5mins chart.

You can see ( point 1), higher highs on chart with lower volume below. That tells us that a possible trend change is going to happen, therefore I will look for LH to enter my trade.




Example nr 3, MTSL again 5mins chart, higher highs on chart with lower highs on volume. In other we see a consecutive hit of pivot point with stuff = possible trend change and if tape confirms the right point to enter short




Last example is SAEX on 3mins chart. You can see breakout of 2.50$ and right away price goes to establish a new high. Then check the volume under and you see that the volume is getting lower and cannot go to the same level of 10mins before. Wait to do now? Wait to grab a lower high and sh with risk hod.


saex 3mins.png


The same thing happens for short side, happens also for the long side.