Price action (SPY) and rsi/macd negative divergency

oldpigwang

Hi, Cobra: Still like to discuss with you for the relationship between price action ( say SPY) and rsi/macd negative divergency.
I posted 2-3 days ago in your 白天灌水: " when (spy)price action =making new high= positive=up, the negative meaning of
RSI/ MACD negative divergency canceled. Price action gover." then the trend should be positive. You response to me:理解不正确。
So，while SPY was making new high during these days, your whole group( see 白天灌水） were struggling to find signal for
reversal, not few were keep  shorting the mkt.
Still I need your advide for this argument beteen price action and RSR/MACD ND.
I am confused, especially when you said " we need   price show new high to identify RSI/MACD negative divergency".
To me, when price make new high, trend is positive= up, the ND become false signal.
Right?

氢氧化钠

Hi, Cobra: Still like to discuss with you for the relationship between price action ( say SPY) and r ...
oldpigwang 发表于 2010-9-11 09:54

    divergence means uptrend is about to finish or just finished. the price action means what is happening; divergence tells you what MIGHT happen next.

oldpigwang

回复 2# 氢氧化钠


    No. In the bull trend from Mar 2009 to Apr 2010, ND were totally beaten down by price action.  Mkt did run up
non stop with there nd persisted for long long time.
In that market,  The only occasion ND work is when you see price (SPY) made double top, or lower high with ND,
then the combination signal are telling you mkt is ready to pull back.
Any way, price action is KING.

氢氧化钠

回复  氢氧化钠


    No. In the bull trend from Mar 2009 to Apr 2010, ND were totally beaten dow ...
oldpigwang 发表于 2010-9-11 10:17

    There is no king or queen in a market. RSI or MACD has its own flaw. It does not work well in some market condition. Price action however, does not work in some other market condition.  Sometimes it really depends on what time frame or what chart you are looking at.

  BTW, the divergence of MACD is pretty clear to me during mar 2009 to apr 2010

oldpigwang

回复 4# 氢氧化钠
Sorry, we are talking about different topic;
Current we are talking about swing trend reversal, just like HTer start short the mkt yesterday:  when mkt top/ over bought
Most likely, daily stoch top, we need RSI MACD 60 min ND to comfirm mkt top, to prove the shorts are right.

Cobra

Hi, Cobra: Still like to discuss with you for the relationship between price action ( say SPY) and r ...
oldpigwang 发表于 2010-9-11 09:54

    http://www.trade10.com/negative_divergence.htm