Now, we will talk about the way to read RSI as a trend indicator. This is another way to use RSI forex indicator after entry indicator. If the RSI shows the number above 50, it can be claimed as uptrend. Definitely, the RSI mark under 50 will be called as a downtrend. You should understand that RSI will be the best friend for many traders, since it is the good tool which enables people avoiding fake outs in trend. You will be recommended to look at this indicator before entering a trade.
Now, what about the use of RSI as the divergence indicator? This one of forex indicators is perhaps less popular than the term MACD Divergence. The fist thing you need to know about divergence is that it occurs when the market moves in the opposite direction as the indicators. What is the positive divergence? This is possibly formed in condition when the market makes lower low but in fact the indicator makes higher low. In fact, the divergence can be claimed as the leading indicator due to its helpful indication to warn you as the traders that the market is going to reverse. Definitely, this is a great thing you need to understand very well.