Regarding MACD divergence, there has been an increase in discussions within the trading community recently, so I want to organize some key points here.

First, there is a fundamental concept to understand. The appearance of divergence does not necessarily mean that the market will reverse. This is a common misconception. Divergence does not equal reversal; it is a sign of energy depletion. In other words, it indicates a higher likelihood that the market will enter a correction phase.

When looking at the 4-hour chart of BTC, there are cases where a clear MACD divergence is forming. However, the market can continue to rise despite this. This is why many traders suffer losses. Relying solely on divergence signals to initiate a sell can lead to painful outcomes.

Next, it’s important to emphasize the need for comprehensive analysis. Judging based only on MACD divergence is risky. Combining the overall market trend, fundamentals, and other technical indicators is essential.

For example, suppose BTC is trading within a range on the daily chart. A divergence appears, which might look like a sell signal at first glance. But if we incorporate wave theory, it could simply be a correction in wave B, with a high probability that wave C will follow. In that case, the low point of the divergence could serve as an entry point for wave C. In other words, the same signal can be viewed differently and turn into a profit opportunity.

In conclusion, it’s crucial to correctly understand the essence of divergence. Instead of viewing it as a mere reversal signal, see it as an indicator of changes in energy state. When utilizing MACD divergence, combining multiple tools such as moving averages, trendlines, and wave theory can lead to more accurate trading decisions.

In the next article, I plan to delve deeper into wave theory. For those looking to improve their technical analysis accuracy, understanding these fundamentals thoroughly can significantly change your market judgment. Wishing everyone stable profits.