What is the explanation of the indicator for hidden divergence?

[SanMiguel]

What is the price action that the indicator is showing us in hidden divergence?
It seems counter intuitive because a higher high of price plus a lower high in the indicator means a reversal.
A higher low on the price but a lower low on the indicator indicates a BUY.

I'm fine with that but what is the indicator showing in relation to price that means we should BUY at this point? What is the technical explanation for hidden divergence?

 

[rawrschach]

With MACD It is the divergence between two moving averages.

And this is the formula for CCI Commodity Channel Index (CCI)

 

[SanMiguel]

With MACD It is the divergence between two moving averages.

And this is the formula for CCI Commodity Channel Index (CCI)

Ok, but
HH on price, LH on indicator: SELL because the indicator says the move isn't as powerful as before.
HL on price, LL on indicator: hidden BUY but the indicator is saying the move isn't as powerful because it;s lower, so why do we BUY?

 

[rawrschach]

The formula should explain it, the idea is that price reverts to the mean.