Hidden Divergence is so-called because it is not always obvious - a Strategy that detects the condition is required to find all occurrences. The following is a comparison of Regular and Hidden Divergence.
Regular divergence:
The classic interpretation of divergence is regular divergence, which occurs when the price action makes higher highs or lower lows while the oscillating indicator does not. This is an early indication that the trend may be coming to an end in the near future. Other patterns are typically used by chartists to confirm the actual reversal.
Hidden divergence:
When the oscillator makes a higher high or low but the price action does not, this is referred to as hidden divergence. This frequently occurs within an existing trend and usually indicates that the prevailing trend is still strong and will resume. To put it another way, hidden divergence is similar to a continuation pattern. Hidden divergence, like regular divergence, can be bullish or bearish.

Hidden divergence is a concept in technical analysis used to identify potential trend reversals in financial markets. It occurs when the price of an asset and a related technical indicator, such as the Relative Strength Index (RSI) or Moving Average Convergence Divergence (MACD), move in opposite directions. Unlike regular divergence, where the price and indicator move in the same direction, hidden divergence suggests a continuation of the existing trend.

In bullish hidden divergence, the price forms a higher low, while the indicator forms a lower low, indicating that the underlying bullish momentum is still strong. Conversely, in bearish hidden divergence, the price forms a lower high, but the indicator forms a higher high, signaling that the bearish momentum is persisting. Traders use hidden divergence to anticipate trend continuation and make informed decisions about buying or selling assets. It is an essential tool for technical analysts seeking to refine their market predictions and enhance their trading strategies.

Hidden divergence is a concept in technical analysis used by traders to predict potential trend continuations. It occurs when the price action shows a higher low (in an uptrend) or a lower high (in a downtrend), but the corresponding indicator (like the Relative Strength Index or MACD) displays a lower low (in an uptrend) or a higher high (in a downtrend). This divergence suggests that the current trend has underlying strength and is likely to continue. Unlike regular divergence, which signals potential reversals, hidden divergence helps traders confirm the existing trend's sustainability. It's a valuable tool for forex and stock market traders aiming to make more informed decisions and enhance their trading strategies.