Brownmandown

Brownmandown

Example of S&P E Mini running liquidity, both sellside and buyside.

Brownmandown

The idea is that all three should move roughly in sync with one and other. If one of the instruments moves out of line , then this can indicate a reversal is about to occur. In this example GBPUSD runs out a previous swing low ( by chance :) at the time of an economic news driver ) , where as EURUSD and DXY do not take that same low out. A reversal then takes...

Brownmandown

EURUSD makes a lower low at 03:15, where as DXY doesnt make a higher high. This divergence happens again at 08:30 but this time EURUSD makes a higher low where as DXY makes a higher high. When this divergence happens, price seems to run in the opposing direction shortly after.

Brownmandown

Divergence between DXY and EURUSD in the price action surrounding FOMC May 2022. Price sweeping highs / lows on one of the pairs , but not creating the mirror image or symmetrical price action on the other as expected, indicating a likely reversal in price action.