I have been focusing on RSI indicators recently and see bearish divergence on some charts.
I am curious about how reliable this signal is for selling. Sometimes it works and other times the price just keeps rising.
How do you consider RSI divergence when trading?
Divergence alone can hit about 60% win rate for me. It works better with support levels.
In my early days, I relied too much on divergence signals. I lost money on a trade with Google because the price kept climbing despite bearish divergence.
Now, I focus on volume as a key factor. If volume decreases while the price rises, I pay attention.
This strategy has saved me from poor trades.
RSI bearish divergence shows 55-65% accuracy in backtests.
• Fails during strong trends
• Works better near resistance zones
• Combine with price action confirmation
Divergence signals weakness, not immediate reversal.
Bearish divergence can be tricky because it sometimes takes a while to play out. Price might keep going up for several candles before finally turning down.
What helped me was waiting for additional confirmation like a break below support or a reversal candlestick pattern. Using divergence alone burned me a few times early on.
Also check the timeframe you’re looking at. Divergence on higher timeframes tends to be more reliable than on very short charts.