Global price divergence in cryptocurrency describes a situation where an asset’s price on one exchange or across different geographical markets varies significantly from its price on other platforms or the global average. This discrepancy can result from differing supply and demand dynamics, liquidity conditions, or regional market sentiment. Such divergences often create arbitrage opportunities for traders.
Context
Divergence can also refer to instances where an asset’s price movement conflicts with a technical indicator, signaling potential trend reversals or weakening momentum. For example, if a cryptocurrency’s price rises while its trading volume decreases, it may indicate a negative divergence. Understanding these discrepancies is crucial for traders to refine entry and exit points and to assess overall market health.
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