Trading RSI Divergence with BigShort
BigShort elevates your RSI divergence trading by integrating powerful indicators like DarkPools, Momo, SmartFlow, and Net Options Flow. Use this approach to identify momentum reversals, confirm entries and exits, and boost trading consistency while working toward financial independence.
What Is RSI Divergence?
RSI divergence occurs when the Relative Strength Index (RSI) and price action diverge. This signals a potential reversal as momentum is changing.
How to Identify the Setup
Divergence Detection: Compare price highs/lows with RSI readings to spot discrepancies.
Validate Confluence: Use other signals (such as those from BigShort) or TA trendlines to validate the move
Confirm Entry: Wait for a volume, BigShort, or price trigger (like a reversal candle) before trading.
How to Trade RSI Divergences with BigShort
Entry Point: Enter when price reverses after confirming divergence, with two or more key BigShort indicators flashing agreement.
See below how, in addition to a bearish RSI divergence, Dark Pools “DPs” (yellow ovals) and bearish Momo (blue arrow) forecasted a coming move down.
From the Momo reversal (blue box), Momo and DPs got increasingly more bearish. These agreed with the bearish RSI and gave BigShort’s users confidence to enter the trade aggressively.
Stop-Loss Placement: Set your stop-loss near the recent high/low to safeguard your capital.
Profit Target: Project your target based on the distance of the divergence. Use BigShort’s indicators like SmartFlow, Net Options Flow (NOF), and Dark Pools to see what the “Big Boys” are doing and time your exits.
Why BigShort?
BigShort gives you the data you need to trust your decisions and be more profitable. By showing smart money movements through DarkPools, Momo, SmartFlow, and NOF, BigShort helps you validate entries and exits for more consistent returns.
Disclaimer:
The information provided in this article is for educational and informational purposes only and should not be considered as financial advice. BigShort does not provide personalized investment recommendations or advice, and you should not make any trading or investment decisions based solely on the content of this article. Trading in the stock market involves significant risk, including the potential loss of your entire investment. Past performance of our tools, indicators, or any referenced strategies does not guarantee future results. Always do your own research and consult with a qualified financial advisor before making investment decisions. Use of our platform and its features is at your own risk.