Momentum divergence is a phenomenon in the world of finance that occurs when the price and volume of a security diverge, meaning they move in opposite directions. This can happen when the price of a stock continues to increase, but the volume of trading decreases, indicating a lack of enthusiasm from buyers. This can be a warning sign of a potential trend reversal, as the momentum behind the price movement is weakening. A keen eye for momentum divergence can help investors make informed decisions in the stock market.
