Further upside is likely technically as we have hidden divergence in play. Hidden divergence occurs when the price makes a higher high or a lower low, but the indicator does not follow suit. In this case, the divergence suggests that the current trend is strong and likely to continue in the same direction. This phenomenon often indicates that there is underlying strength in the market that may not be immediately apparent. Traders and investors often use hidden divergence as a signal to confirm the strength of a trend and make informed decisions about their positions.
In the context of bullish momentum, hidden divergence can be a powerful indication that the uptrend is intact and has the potential to extend further. It implies that despite some temporary setbacks or corrections, the overall trend remains bullish, and there is a high probability of prices moving higher in the near future. Traders who recognize hidden divergence early on can use it as a valuable tool to stay ahead of the market and capitalize on profitable trading opportunities.
Chris's observation of hidden divergence in the current market conditions suggests that there is a strong likelihood of continued bullish momentum. This technical analysis insight provides valuable information to market participants looking to navigate the dynamics of the financial markets effectively. By understanding and utilizing technical indicators like hidden divergence, traders and investors can enhance their decision-making process and improve their overall trading performance.
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