Smart Divergence [Reason Edition]

Stop trading divergences "in thin air". Start trading structural confluence.

Most divergence indicators fail for one reason: they signal reversals based solely on oscillator math (RSI vs. Price), ignoring the chart's structure. This leads to costly entries against strong trends.

Smart Divergence [Reason Edition] solves this by applying an Institutional Context Filter. It does not simply alert you of a divergence; it validates the signal against key market structures ("Walls") and—crucially—tells you exactly why the signal appeared directly on the label.

🚀 How It Works: The "Smart Filter" Logic
This script operates on a strict rule: "No Structure, No Signal."

For a Bullish or Bearish divergence to be valid, price must not only diverge from RSI but also physically touch or react to one of four key structural levels:

BB (Bollinger Bands): Rejection due to volatility extension (2.0 StdDev).

KC (Keltner Channels): Rejection due to average range deviation (1.5 ATR).

Pivots (S1/R1): Rejection at standard daily algorithmic levels.

VWAP: Rejection at the institutional average price (Volume Weighted Average Price).

🏷️ Dynamic "Reason" Labels
This is the core feature of this edition. The label on your chart adapts dynamically to show the specific confluence behind the trade.

Examples you will see:

SMART BULL (BB) → The divergence is valid because price hit the Bollinger Band.

SMART BULL (VWAP) → The divergence is valid because price bounced off the VWAP.

SMART BULL (BB VWAP) → High Probability: Price hit the Bollinger Band AND the VWAP simultaneously.

The Logic: The more "Reasons" (acronyms) appear inside the label, the stronger the structural wall, and the higher the probability of a reversal.

🛠️ Settings & Features
🛡️ Smart Filter (Toggle):

ON (Default): Only shows high-quality signals that occur at Support/Resistance zones.

OFF: Shows all raw technical divergences (standard mode).

Alerts Included: Setup custom alerts for "Smart Bull" (Buys) and "Smart Bear" (Sells).

Zero Repainting: Signals are confirmed upon candle close/pivot confirmation.

📋 How to Trade It
Wait for the Label: Do not guess. Wait for the SMART label to appear.

Check the Reason: Look at the text in parenthesis (...).

Single reason (e.g., KC) is a valid setup.

Cluster reasons (e.g., BB S1 VWAP) represent a "Concrete Wall" and are ideal for aggressive entries.

Context: Works best on Intraday timeframes (1m, 5m, 15m) for scalping, and Daily timeframe for Swing Trading bottoms/tops.

Disclaimer: This tool is for educational purposes and technical analysis assistance. Past performance does not guarantee future results. Manage your risk.