Developing a system #11 (Mohammed Munzer Divergence System)

Submitted by Mohammed Munzer

I am trying this Divergence system
It seems working well and I want to reveal it here
I wish from readers comment on it in order to advance it

Timeframe: any timeframe (60 minutes preferred)
Indicators needed: DPO(14) Stochastics(9,5,5) Pivots daily (Including midpivots ignoring the pivot line)

We wait till a divergence appears (Regular or Hidden) with DPO confirmed by Stochastics then waiting till price breaks a pivot level whatever it is to put an entry order with the opening with new candle in the new zone..
Limit is put at the coming pivot level (Support or Resistance) excluding the pivot line and stop is put at the extreme of the previous candle.

If price breaks the level of the 1st price divergence line we put another entry order with the open of the new candle if its level was away of a pivot one or we are obliged to wait the break of the coming pivot
that's usually enough (2 orders) because conditions after than would be diminished as we are only depending on divergence away of any another technique.

Waiting ur comments
Good luck

Edward Revy,

Copyright © Forex Strategies Revealed

Edwards, can you please recommend which charting softwares I can use for backtesting the results, that is I can see the hourly charts for say 2007-2008 period and so on.
I would be highly obliged.
Thank You

What is the difference b/w real and hidden divergence?

i like this strategy , i will apply it , thanks


Divergence is an important tool that i use, I watch my RSI 7-periods (I know your DPO is more like an RSI) on 1hrs time-frame daily to predict the next trading day and any time I spot Divergence, I smile, so Stochastic crosses on 1hr time frame will be your trigger and very profitable, grabbing minimum of 50-100pips on GBP/JPY.


and this is an example on the four hours chart audusd
Bearish regular divergence :
Higher highs in price 1-2 and lower highs in DPO 3-4 confirmed by lower highs in Stoch 5-6
watch 0.7138 and when price opens below this level open a trade
targets depend on FE(fib expansion) 61.8-100-161.8 (3 lots) and donot forget to move the stop loss with the move of the market

DPO and Stoch divergence

Hello Mr Edward
I mean we look for a div between price and DPO confirmed by div between price and stochastics too
and then wait for the break of a pivot level when working on 1 hour or less timeframe chart
on 4 hours or bigger timeframes we search for the break of some support-resistance levels like peaks and trough fib level etc...

DPO and Stoch divergence

Hello Mohammed,

Do you mean we look for a divergence between price and DPO indicator?

I'll make a screenshot for it.
Also, the indicators can be downloaded below:



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