Divergence Chart

Class A Bullish Divergence:

“Class A” Bullish Divergence take place only when price makes a lower low but the indicator makes a higher low. This is the strongest buy signal.

Class A Bearish Divergence:

“Class A” Bearish Divergences take place only when the prices make a higher high but the indicator makes a lower high. This is the strongest sell signal.


“Class B Bullish Divergence”:

“Class B” Bullish Divergences take place when price forms a double bottom like formation & the indicator makes a higher low. This is the second strongest buy signal.

Class B Bearish Divergence:

“Class B” Bearish Divergences take place when price makes a double top like formation the indicator makes a lower high. This is the second strongest sell signal.
 
Class C Bullish Divergence:

“Class C” Bullish Divergences take place when the indicator has made a double bottom like formation and the price makes a lower low.

Class C Bearish Divergence:

“Class C” Bearish Divergences take place when the indicator has made a double top like formation and the price makes a higher high.

In all the above classification of the divergences we discussed Class A divergence is supposedly the strongest one to identify crucial market turning points… Class B divergences are less strong and Class C are least important.