Divergence in trading refers to a situation where the price of an asset, such as a currency pair, and a technical indicator, such as the Relative Strength Index (RSI), move in opposite directions. There are two types of divergence: bullish and bearish. Bullish divergence occurs when the price of the asset is making lower lows, while the indicator is making higher lows. This can signal a potential trend reversal to the upside. Bearish divergence occurs when the price of the asset is making higher highs, while the indicator is making lower highs. This can signal a potential trend reversal to the downside. Traders use divergence as a tool to identify potential changes in trend and make trading decisions accordingly.