Price Divergence and Trend changes. Also a case for a bullish STEEM?!

One tactic I have in my trading playbook is the use of divergences. These differences between the price and indicator values can point out short to mid term changes in the direction of the market. These can be especially useful when trying to swing trade or for the more advanced trader, counter-trend trading. I even use this for short selling if not trading on margin. However this is risky and not for the beginner.

Note that I am using the RSI indicator but and momentum indicator will work.

There are four chart formations to look out for (excluding hidden divergences) when we take this approach.
The first is a Bullish Continuation pattern:
As price makes higher lows we can observe that the RSI is also making higher lows. As momentum is pointing to the same direction as the price, we can assume that that price may rise in accordance.

Bearish Continuation pattern:
The same idea applies here however this time we are looking for lower highs in the price paired with lower highs on the RSI. The price is falling along with dropping buying momentum.

The Bearish Divergence:
With a bearish divergence we observe higher highs on the chart. while this is a sign that price may move higher, we also note that the RSI is making lower highs. Although price is increasing, the momentum in the move is dying down, signaling that sentiment could be changing and in the short term we may see a correction.

As you can see on this chart each pattern was confirmed with the subsequent move in price.

Finally we move onto the Bullish Divergence currently in play on the STEEM / BTC chart.
On the 4hr chart we can see that price marginally lower lows but the RSI is making higher lows. As momentum increases so does the chance for a bullish move on the chart.

Steemers please leave a comment, follow, resteem and upvote. I want to keep delivering and improving on my content so any feedback would be great :)