Volume Divergence Patterns

Volume Divergence Patterns occur when price makes a new high or low, but the trading volume does not confirm this move by also reaching a new high or low. This is a classic signal that the current trend is losing strength and may be about to reverse.

It suggests that while the price is moving, there is less conviction behind the move from market participants. Traders use these patterns to spot potential tops and bottoms in the market.

It is a powerful tool for validating the sustainability of a trend and avoiding trades that are likely to fail.