This time we will describe the bullish RSI divergence. The blue line on the price chart indicates that the price action is creating lower bottoms, while the RSI line is increasing. This shows that there is a bullish divergence between the price action and the RSI indicator, meaning that the price of this pair is likely due for an increase.
As you can see, this is exactly what happens.
The bearish divergence acts the same way, but in the opposite direction – price action tops are increasing and the RSI tops are decreasing.
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