Should I consider the divergence from the wick?

lucacrebbe

Active Trader
Jun 26, 2017
108
1
32
41
In the pic I have simulated a divergence with an indicator (the blue line oscillating)
the black and the green lines show the degree of the divergence between oscillator (on balance volume) and price

Question is: am I doing good drawning the black and the green line from the wicks of the candles, or I shouldn't consider the wicks?

https://i.ibb.co/Tc8Cp15/divegenz.png
 

Attachments

Enivid

Administrator
Staff member
Nov 30, 2008
16,033
812
144
Odessa
www.earnforex.com
If you are using OBV (On Balance Volume), you should be considering the wicks in my opinion. Because OBV is generated from the volume, including the one generated at wick prices.

I would only avoid counting wicks if your divergence indicator is based purely on Close price - like the classic RSI for example. Then, I would just ditch the candles and draw the line (Close) chart.