Divergence against the last swing, not against the year
Momentum divergence is only as honest as the pivots you are willing to mark. Distant highs make almost any oscillator look insightful.
Divergence is a comparison. If you compare the current oscillator reading with a high from last spring, you can usually find a story. In this classroom the comparison is with the preceding swing — the last clear pivot you would have marked at the time, not the picturesque one you can see now that the chart has grown a left side.
We make students mark pivots in pencil before they are allowed to talk about divergence. If they cannot agree on the last swing, they are not ready to claim a disagreement between price and momentum.
How we mark the swing
On a weekly chart we look for a pivot that interrupted the prior move for more than a couple of bars and that was obvious without zooming. Intraday noise is not invited. If two people at the table pick different pivots, we write both and we do not force a winner. Divergence that depends on winning an argument about which bump counts is too fragile to carry into a live month.
Once the pivot is marked, we compare price extreme to price extreme, then oscillator extreme to oscillator extreme. Both comparisons must use that same pivot. Mixing a nearby price low with a distant oscillator low is a common way to invent a pretty slope.
Confirmation still waits
Even a clean divergence against the last swing is momentum information. In our rulebook it may be the first mark. The second remains a price event: a close, a break of the little range that formed while the oscillator disagreed, a failure to continue the old extreme. Divergence-as-entry is the cousin of RSI-as-entry. We have the same conversation, with different vocabulary.
Rate of change, when someone brings it, is treated the same way. It can support the momentum read. It does not get to be the confirmation of RSI simply because both are 'not price'.
Bring the preceding swing to class
If you come to the intensive, mark the last swing on your two home charts before you travel. We will spend less time debating which bump is real and more time deciding whether your second mark is independent. That is the scarce resource in a room of eight: attention, not another definition of divergence copied from a handbook.