Confluence occurs when several technical analysis methods give the same trade signal.
Usually, these are technical indicators, but may also be combined with chart patterns, price action, and chart overlay tools.
Originally, the term confluence is used to describe a geographic point where two or more rivers come together to form a single body of water.
But following the same logic, it’s now used in the context of trading, to describe the confluence of multiple trading signals.
Usually, these are technical indicators, but may also be combined with chart patterns, price action, and chart overlay tools.
Originally, the term confluence is used to describe a geographic point where two or more rivers come together to form a single body of water.
But following the same logic, it’s now used in the context of trading, to describe the confluence of multiple trading signals.