Detecting Regular and Hidden Divergence with Any Oscillator

Summary

This indicator compares oscillator pivots with corresponding price pivots to mark four divergence patterns. Regular bullish divergence pairs a lower price low with a higher oscillator low; regular bearish divergence pairs a higher price high with a lower oscillator high. Hidden bullish and bearish patterns use the opposite oscillator relationships alongside higher price lows or lower price highs. The selected oscillator plot can be shown on its own pane or mapped onto the price chart.

Pivot lookback settings and a minimum-to-maximum bar range govern which swing pairs are compared, while switches control which patterns appear. Pivot confirmation requires bars to the right of the candidate pivot, so signals can be delayed. An optional setting waits for candle close to avoid changing real-time plots, with further delay as a tradeoff. The document presents indicator logic and usage instructions, but gives no performance tests or evidence that divergences forecast profitable trades.

Key ideas

• The indicator can evaluate any selected oscillator series against price pivots.
• Regular bullish divergence pairs a lower price low with a higher oscillator low.
• Regular bearish divergence pairs a higher price high with a lower oscillator high.
• Hidden divergence patterns compare higher or lower price swings with the corresponding opposite oscillator swing.
• Pivot lookbacks and a bar-range filter constrain the swing comparisons, and candle-close confirmation can reduce repainting at the cost of delay.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.