One thing about divergence is, for me at least, finding 1 indicator to base the divergence on. Maybe 2 indicators. But I truly believe that getting to know 1 indicator with SET parameters lets you have a solid reference point to compare correlations. For example: if using RSI over a 14 period, stick to the 14 period only. If using momentum on a 10 period, never change the 10 period. Get to know one of them and their correlation to price action. Many traders will tell you that the indicator just shows what the chart is already telling you. Of course this is partly true. However, it is the correlation of the price action to the indicator and for some traders it is just clearer to see specific information from a chart pattern represented separately from the price action, hence, an indicator. Really it comes down to what the indicator does for you and you only. Just like watching chart patterns form, after some time you get into the rythym. Same for an indicator. It is the rythym of that indicator with the rythym of the stock, future, etc. that it is playing along with. So, find your tune. Can't get into rock music, ES, try dance music, NQ. Can't see any rythym in RSI try MACD or none if chart patterns alone work for you.
I've read the thread and read your replay. The bottom line for anyone is making money. There are limitations. Posters here tell you about their relation to the 1 min chart. My conclusion is that the potential earnings represented by the 1 min chart are mostly unrealizable because of the practical limitations of the users. So I do not recommentd using anything on the 1 min chart as a pratical way to max out making money. Divergence means different things on different types of charts. That has presently elluded all posters here. Not to labor the point, but STOC makes the simplest example. You may only, on a relatavisitc indicator, use divergence from the 50% point onward. This is not known to you or the others posting here. If you use divergence coming toward the 50% line, like say from lines like 80 or 20 then you are measuring only that the current price trend is slowing. This is tough for people to swallow when they think superficially. If you compound such superficial thinking with a fast fractal like the 1 min. You get to a rather bad situation for continuing to make money. What you see here in ET is many many hair trigger traders and people who gravitate to scalping in ono scaplable markets. they are forcefully reinforcing burning into their brains that they loose often and they are in total fear because of poor and erratic performance. The cause is cited above. Where you are now is building an approach. Your replay incorporates many superficial ways of thinking that are not correct, with specific emphasis of the emotional terminology that expresses being trapped in fears of many sorts. The very important consideration that this post will introduceto you is that you must at all times learn to know when you are learning something incorrectly. Here are some correct factoids to keep in mind. Divergence exists only because of the relationship of the component values assigned to the maths. Initial divergence only works as a signal for possible price changes (to make profits in that direction) if you are using an absolute indicator and it's corresponding correct signals. For a relativistic indicator divergence, as an indication of possible price changes to make profits in that direction, there is no signal until after passing and continuing more divergence at a greater rate of divergence (a lesser rate is not a signal) past the newtral value of the relativistic scale (50% for STOC). Divergence ALWAYS ends. Convergence as a signal and entwining as a continuing signal are both more important signals than divergence. The former prepares you for exits and the latter is the strongest "hold" signal there is for relatiavistic indicators when the entwine is far from the neutral value.( 50% for STOC). My summary thought on 1 min divergence for making money is this: unskilled people will not only not make money using such but skilled people will not turn toits use ever because of it's inherent potential to increase their process of optimization. What this means it that it has no value to anyone for making money under any circumstances. Your replay, in a larger context will not serve you well at this time in learning to make money. As others said, "I can't take the time now to explain and give you examples of whatever", I, on the other hand will, if necessary, straighten out the mistaken points that they have made.
TRADERSAVVY...... you have posted the critical factor.... keeping the indicator settings constant...unfortunately the same indicator will/ willnot show divergence merely as a result of the indicator settings we have chosen... we have accidently " rigged" the results by doing this.
IMHO the posts I see on Elite from traders using multiple candle formations and divergence on one minute charts is just not realistic. I'm not saying to discard one minute timeframes - I'm just saying that trying to divine too much from them is not realistic. You'd be better served just tape-reading and trading order flow as a short-term daytrader.
I would suggest paper trading whatever divergences youre referring to for awhile. You will discover rather quickly that theyre much easier to spot after the fact. I have tried about a million variations on that theme. I like what dgabriel said in his first reply here. p.s. fwiw, Linda Raschke says she doesnt take a divergence too serious unless there is about 90 minutes to 2 hrs between them and that lady knows a thing or two.
This is what makes a market. Obviously there are differences of opinion here on 1m charts/divergences. I am going to attach a chart here of a 1m reversal with divergence that coincided with a 60m pivot. This is how I personally find 1m charts / divergences very useful. The stop for the low on the 1m chart is the low on the 60m pivot candle. It catches the upswing in the 60m timeframe as well as the 1m. So, as far a only small moves being there for the 1m timeframe, I think not. I'll post the 60m chart next.
Here's the 60m chart. An important point on divergences IMHO is that the divergence alone is not a reason to trade. Price action tells you when to enter.