About This Strategy
A reversal strategy built on bullish RSI divergence: price prints a lower low while RSI holds a higher low — an early warning that selling pressure is fading before price confirms.
Strategy Summary
Divergence measures the disagreement between price and momentum. When price falls to a new low but RSI refuses to follow, the decline is losing force — a classic precondition for reversal.
Qualification Criteria
- Price prints a lower low across two pivot points
- RSI prints a higher low across the same pivots
- Divergence strength score above the minimum threshold
- Preferably forming in the oversold or bearish RSI zone
The scanner detects pivot pairs, grades each divergence by strength and RSI zone, and tracks confirmation status — so you can separate developing setups from confirmed reversals.
Who This Strategy Is For
- Contrarian traders hunting for turning points
- Swing traders who want early reversal alerts
- Traders who combine divergence with support levels
- Anyone who wants divergences graded, not just flagged
Trading fit
Divergence measures the disagreement between price and momentum. When price falls to a new low but RSI refuses to follow, the decline is losing force — a classic precondition for reversal.
No names are firing right now, but the setup rules remain visible for the next market cycle.
This playbook does not have a dedicated historical snapshot attached yet.
How It Works
Detect price pivot lows and matching RSI pivots
Flag pairs where price fell but RSI rose
Grade strength from RSI delta, zone, and volume context
Watch confirmation status: developing → confirmed or failed
Enter on price confirmation with a stop under the divergence low
Advantages
- Early warning before price confirms the turn
- Graded strength and confirmation tracking
- Defined risk under the divergence low
- Strong when aligned with support zones
Disadvantages
- Divergences can persist while price keeps falling
- Needs price confirmation — never trade the signal alone
- Weaker in strong downtrends
- Pivot detection is sensitive to noise
Live PSX results
Use this section to see whether the strategy is only educational or currently producing live PSX candidates. Live strategies show fresh scan results, while the backtest block below provides historical context where available.
How to use this strategy on PSX
Check Market Overview and Money Flow first so you know whether PSX breadth, flow, and sector leadership support this setup type.
Use the price, structure, and confirmation columns together. These strategy pages are designed to improve selection quality, not to replace execution and risk management.
Backtests help you understand expectancy, hold time, and drawdown behavior. They should sharpen judgment, not turn a setup into a guaranteed trade.
Related PSX strategies
Compare this setup with similar strategies in the same difficulty bucket to see whether trend, breakout, pullback, or confluence logic fits your process better.
Research note: Live scan results are pulled from the backend strategy feed. Always validate context, liquidity, and risk before trading.