Stochastic Divergence

📊 How to Interpret the Levels
🔻 Bearish Divergence

61.8 level → Strong bearish divergence
If the price makes a higher high but the Stochastic makes a lower high near 61.8, it’s a high-conviction short.

69.1 level → Weak bearish divergence
The same setup, but at 69.1 it's valid, although less reliable. Treat it as a secondary confirmation.

🔺 Bullish Divergence

38.2 level → Strong bullish divergence
If price makes a lower low but Stochastic makes a higher low near 38.2, it’s a high conviction long.

30.9 level → Weak bullish divergence
Same setup, but at 30.9 is weaker. Supportive, but not primary.

🔄 Continuation

Bounce at the 50 line → Continuation.
If Stoch pulls back and holds/bounces off 50, it signals trend continuation (bullish if above, bearish if below).

⚖️ Hierarchy of Strength

61.8 / 38.2 → A-Tier (strongest divergence signals)

69.1 / 30.9 → B-Tier (secondary / softer signals)

50 → Continuation (trend confirmation, not reversal)

🧠 Why This Matters

Traditional Stochastic only looks at overbought (80) and oversold (20).

By layering in Fibonacci retracement levels, you refine where divergences have teeth.

This prevents false signals at weaker spots and helps you assess divergence strength accurately.