Hidden Bullish & Silver Hidden Bearish Divergence Silver Trading

Hidden divergence is used as a possible sign for a silver trend continuation after the xagusd price has retraced. It is a trading signal that the original silver trend is resuming. This is the best set up to trade because it is in the same direction as that of the continuing market trend.

Silver Hidden Bullish Divergence

This setup happens when xagusd price is forming a higher low (HL), but the oscillator (indicator) is showing a lower low (LL). To remember them easily think of them as W-shapes on Chart patterns. It occurs when there is a retracement in an upward Silver trend.

The example explained and shown below shows an image of this silver setup, from the screenshot the xagusd price made a higher low (HL) but the indicator made a lower low (LL), this shows that there was a diverging signal between the xagusd price and indicator. This signal shows that soon the xagusd trading market up silver trend is going to resume. In other words it shows this was just a retracement in an upward silver trend.

This confirms that a retracement move is complete & indicates underlying strength of an upward silver trend.

XAGUSD Trading Hidden Bearish Divergence

This setup happens when xagusd price is forming a lower high (LH), but the oscillator is showing a higher high (HH). To remember them easily think of them as M-shapes on Chart patterns. It occurs when there is a retracement in a downward Silver trend.

The example explained and shown below shows an image of this silver setup, from the screenshot the xagusd price made lower high (LH) but the indicator made a higher high (HH), this shows that there was a divergence between the xagusd price and indicator. This shows that soon the xagusd trading market down silver trend is going to resume. In other words it shows this was just a retracement in a downwards trend.

This confirms that a retracement move is complete & indicates underlying strength of a downward silver trend.

Other popular technical indicators used are Commodities Channel Index technical indicator (CCI), Stochastic Oscillator, RSI and MACD. MACD & RSI are the best technical indicators.

NB: Hidden divergence is the best type to trade because it gives a signal that's in the same direction with the current market trend, thus it has a high reward to risk ratio. It provides for best possible entry.

However, a trader should combine this xagusd trading setup with another indicator like the stochastic oscillator or moving average and buy when silver is oversold, and sell when silver is overbought.

Combining Hidden Divergence with Moving Average Crossover Method

A good indicator to combine these silver trading setups is the moving average indicator using the moving average cross-over method. This will create a good trading strategy.

Moving Average Crossover Method

In this strategy, once the signal is given, a trader will then wait for the moving average cross-over technique to give a buy/sell silver trading signal in same direction, if there's a bullish divergence setup between the xagusd price and indicator, wait for the moving average crossover system to give an upward cross-over signal, while for a bearish diverging setup wait for the moving average crossover system to give a downward bearish crossover signal.

By combining this silver trading signal with other technical indicators this way one will avoid whipsaws when it comes to trading this xagusd trading signal.

Combining with Silver Trading Fibo Retracement Levels

For this example we shall use an upwards market trend. We shall use the MACD indicator.

Because the hidden divergence is just a retracement in an upwards silver trend we can combine this silver signal with most popular retracement tool that is the Fibonacci retracement levels. The example explained and shown below shows that when this xagusd trading setup appeared on the chart, the xagusd price had just hit the 38.20% level. When xagusd price tested this level, this would have been a good level to set a buy order.

Combining with XAGUSD Trading Fib Expansion Levels

In the xagusd trading example above once the buy silver trade was placed, a trader would then need to calculate where to set take profit for this trade. To do this a trader would need to use the Silver Trading Fibonacci Expansion Levels.

The Fibonacci expansion was drawn as shown & illustrated on the xagusd chart as shown and illustrated below.

For this example there were three take profit areas:

Expansion Level 61.80% - 131 pips profit

Expansion Level 100.00% - 212 pips profit

Expansion Level 161.80% - 337 pips profit

From this strategy combined with Fibonacci would have provided a good strategy with a good amount of profit set using these take profit areas.