How to use RSI Indicator in Trading?

Welcome back guys to a wonderful video Where we are making a series of trading course Where we will go from basics to advance So, indicators come in our way Many people must have heard from you that indicators are bad You should not use it at all Well, obviously, we can't always do trading on the basis of indicators. But indicators play an important role Although, in this era where we can do algo trading. We can put it on automation Indicators play a very big role in algo trading And in trading too, I use indicators I don't say that I will only use price action I won't use SMC I will use SMC's best, price action's best In market theories, there is Dow theory Or there is Elliott theory. Or any other theory I use its best, indicator's best By combining them In order to become a successful trader, you need to know So, today we have started this indicator series. We will cover all the indicators. In fact, we won't cover all of them Obviously, there are some indicators that think are nonsense.They are not very useful Like Ichimoku cloud Or moon phases they have made an indicator on the moon so, maybe we should cover them too And I leave it on you On the viewer. On my subscriber how much respect he has to give or not So, what we will do today I will say it directly One indicator never works at least two indicators can be combined And a strategy can be made By applying a little price action Obviously, it is important to use your brain. So, today we will learn RSI Relative Strength Index and people use it in a different way I use it in a different way I will teach you both And its advanced version Which we call RSI Divergence so, we will learn RSI and RSI Divergence. We will learn both today And later we will learn more indicators So, by combining them we will start making strategies So, the series has started So, let's start the video. So, this is my favourite indicator's list If you want to take a look at the scroll No problem. Why is Ichimoku cloud here? Because I used to use it earlier So, I didn't remove it Why is Moon Phases here? I was doing a trial Because I was checking everything In Invite Only there are some indicators made by me which are all locked We will talk about them sometime But first let's talk about our indicator Which is called RSI So, RSI When we click RSI Something like this opens down something like this opens up Okay? So, when it opens down So, let's do one thing Let's make the screen black this time My eyes are hurting a lot Okay. So, as soon as the indicator opens We have to go to the setting. If we go to the setting So, first of all RSI based image We have to close this yellow line RSI is useful for us. And because it is black So, I will make it red first Okay Now, what is it? When we Upper Bollinger band We don't need all of these Close all of them Regular bullish. Regular bullish label Close everything If we want to use something here then only RSI upper band Middle band Lower band Fill. And, RSI This is the red line And all of these These extra features Were not there before We only have to use RSI When we come to input So, here it is 14 People tease it Although If you have experience You can do it But I say 14 is best that's why the number is kept here. Source will always be close We don't have to calculate divergence We will calculate it manually We don't even need moving average So, there is no difference here Whether it is SMA or WMA Or EMA It doesn't even matter here And its number is better We will keep the time frame of the chart Although. We are doing 5 minute time frame analysis So, if we want We can also see RSI of 15 We have the option If I change it to 15 It will be 15 minutes It will change RSI It is 15 minutes we do this in special cases. In advanced level But now we will keep it as a chart Okay So, guys RSI is such an indicator And In the last We will see a setting again If we go to style Number 70 and 30 is written here If I change this number to 60 and 40 Then see behind See What happened Area became small. See It became small this band now when I increase this number again To 70 and 30 Then area will increase So, what is that? It is a level See, when RSI breaks 70 here It shows that the market has gone up a lot. So, in RSI People are always confused What to see in RSI So, let me explain In small time frame People see RSI For momentum If RSI is increasing. It means momentum is coming In small time frame or in lower time frame I have already made a video on time frame I have put it I hope you have seen Everything is coming in the series So, in RSI In lower time frame People see momentum If RSI is increasing It means momentumis coming. Although RSI does not give momentum If price increases RSI increases Always remember. No indicator is leading Mostly indicators are lagging Lagging means Price will go ahead Price will lead It will follow it Lagging It will follow it Lagging Very few things are leading Like price action Price is always leading It always goes ahead. So, we are reading that Along with the indicator, And usually wen we see LTF In big time frame Daily time frame Weekly time frame When we see RSI. So, we see it For oversold or overbought regions If RSI has increased a lot. So, we try to reverse it Although we can also interchange it But let's start It depends on us Which strategy we have to develop. So, I have opened RSI in 5 minutes time frame So, what I say Different people make different strategies Some people think When market will break out Then I will buy. Here RSI is breaking out Here RSI is breaking out Of this level. If you uy here Then market is going up. This s a strategy When it will break down Then you have to sell. For example, look here. It broke its band down. So, you sold here So, it went down with a little pullback So, you can follow both strategies Okay So, I will tell you What you should do You prefer to reverse it If you anywhere. Let the market Break any level Let it break And after breaking When it goes inside You don't have to buy here. When it goes inside then you have to buy For example, you will see The video is being made on 16th If we see When the first candle was made. Then the market went out And then this candle was made So, if we buy here. Then we will put stop loss here. So, 1 is to 2 Is easily achieved. So, will it not work always I will show you We got 100 rupees What happened before this We get a sell entry again See Here again the market came out And when it went inside Then we sold So, we will see We get another trade Where we get 2 targets RSI strategy Simple I am telling you The strategy The market is closed 1 is to 2 is also hit. Simple strategy When it will go out. It went out here and went inside Where did it go It went out here. It went out here And went inside. So, buy here See, we took a trade here So, stop loss is hit. Okay. I am doing a backtest And showing you. Not every strategy works. All the time But definitely You have to calculate More or less S&L So, we got S&L here And we had to sell here We have to sell on this candle It is telling on the red candle So, if we sell on the red candle Then we will get a target Not on this candle We will sell on this candle Okay So, we got a target here 1 is to 2 So, see How we We started checking So, we got 3 targets 1 S&L Let's see more. more It was telling us to sell here On this place If we would have sold here Then it would have gone sideways We won't get a target We will sell here We can get a target. We will sell here So, we have to see the candle I have made a video on candle stickers So, we won't sell on this candle We will sell here On this candle. Because there was no candle. So, we will try 1 is to 2. And then we will get a target. This strategy is doing a good job. Okay Target got hit no problem Let's see more. It is telling us to sell here It is telling us to sell on this point We didn't get a candle here We got a candle here S&L got hit So, by doing this If we would have taught you any strategy Then there would have been a stop loss So, what we saw When we analyzed this whole week Till monday. Monday Tuesday Wednesday So, we get to know. On Monday, Tuesday 1 So, we got 2 S&L And 1 2 3 4 targets Good Like. It is obvious In some weeks It will do a worse job In some weeks It might give all the targets So, whatever you want You can follow So, this is a better strategy to follow. Whenever it goes out of 70 And enters inside So, sell Buy from below Like RSI It works in gold It works in gold If we go We will see on gold chart So, in this Look here It gave us a sell entry here. Okay It gave us a sell entry here. So, we will sell here Okay Like we will sell on red candle So, stop-loss is set Our first trade was stop-loss. Okay Stop-loss is set. We will see the second trade It gave us a sell here Here One more Stop-loss is set. It gave us 2 stop-losses in a row This strategy gave us In gold Okay, here it will be stop-loss It said to buy here It will give us a target here Here If we see here Here We enter on this candle Inside On green candle. We will buy here So, here We will achieve a good Big target If we hold If we hold We will get a big target And we will see It said to sell here So, we will sell here Like we will sell here So, it gave us A target here Great We got 1 out of 2. Okay. After this It said to sell here. Here If we sell here It would have been an SL Let's calculate There is no problem I am with you This is my work By teaching I mean Both good and bad things Tell me SL hit It said to buy here Target hit here Okay So, let's see Till Tuesday Till Monday No problem Let's see the data till Monday If we put a stop loss here So, here again Target hit 1 out of 2 3 Then we will see. It said to sell here It said to sell here Stop loss hit. So, only 1 trade will be made If we sell here Inside. It entered here It entered here We didn't get a good candle. Here We got a good candle here Still, stop loss Hit Stop loss. Stop loss I will put here It is possible If stop loss hits It may not. There is a doubtful trade It is 50-50 It can be a target It can be a stop loss Because it did 1 out of 2 Here But it depends If it can be a stop loss So, no problem. Let's see till Monday Till Monday It is still Tuesday It said to buy here It entered inside It entered inside So, we get here Again, target So, you have to test it like this Write how many points Target you got How many I hope you have seen this video Back testing It is a mind-blowing video In the whole industry I have made such a video. That's why I am not praising I have not seen I have not uploaded such a video. Openly I will definitely see such a video Back testing Showing how to do Let's do it till Monday No problem It is looking here It is telling to buy It came out So, we will buy here. We will buy here We will put stop loss here. So, target Is it 1 out of 2 1 out of 2. So, it is done 1 out of 2 So, it is done here too. Okay, Okay And where we have to go to the market Then It is telling to sell here Monday morning It is telling to sell at this point So, it is telling to sell here So, we will sell here Monday morning Here somewhere. So, here too We have a good target It is giving 1 out of 2. Okay guys. See Let's see Monday So, we have 1 target 2 targets 3 targets 4 5 6 7, 7 targets And if we talk about stop loss. 1 2 3 So, see So, this is Gold over here Okay. So, what did you see So, this is RSI strategy How did we use RSI We used it for reversal When the market goes overboard Then do this Okay It will work in big time frame In big time frame But remember What some people do Sir, I will sell it You don't have to sell it up If it goes up Then it will be better If you catch the trend Then You have to wait And Do this. And here Price You can't just trust the indicator Candle See If the candle is like this You have to sell it If the candle is like this Will you sell it You won't You need a red candle Like this Or like this So, obviously You can't sell on this candle You have to put the price action But it doesn't work for the indicator Now, guys I will show you a concept. Which is RSI divergence Now, this is a new thing Let's see on bank nifty What is RSI divergence What is RSI divergence RSI divergence is That you have to The levels of RSI And the levels of price How to match I will explain to you I will show you a good example. So, guys Watch carefully RSI Obviously Whatever you can see here. Price and connected If I keep the mouse here It will connect. So, guys I want to pick a trend line I picked this trend line And What I am teaching Which strategy Works more Divergence is an advanced level thing People have to learn So, go and learn somewhere Learn on my channel But How much it works I will show you the reality Okay So, first Let's understand the concept. What is divergence See Hold a trend line Mark from here to here. The trend line How is the trend line marked. The trend line We can understand By looking at it There is an angle A little upward Can you see Like it was here So, this angle Is a little upward A little Can you see A little upward Angle A little Consider it equal But here From where I started Marking the trend line Started from this point I start From that point Can you see Made an equal point. And where I took it To here To here It is down here So, the price Is saying I will go down But RSI is saying I will come like this. Or hold it like this A little. So, here RSI is saying I am bullish So, this is called Bullish divergence And when the price was negative But So, from here We can see a rally Upward Can you see Got it Okay So, you saw Bullish divergence. Now, once Let's try to understand Bearish divergence Where will we get Bearish divergence. Got it Guys, look Now, what you have to do Here I will show you bearish divergence See, what is here There is a peak At the top When here There is a top And here A trend line So, it is showing The angle Downwards. This trend line Is saying I will make The angle Downwards It is making like this Okay. So, what do you understand It is making The angle Downwards Here On these points I am drawing The line on the price I am drawing from here Guys, it is saying. It is bringing the angle Towards the top. See Price is saying I will go up RSI is saying I am weak Towards the bottom Divergence, Divergence means There is a difference. There is a divergence Between both It is saying I am weak Market split Downward Okay. So, this is fascinating I know. For a first time viewer If you are watching For the first time You will enjoy a lot Wow You will think Hidden secret. You will think It is money But it is not like that It happens New people Who have experience. Who have seen it 2-3 times. They will also feel Maybe I can use No. Don't use divergence. It is a foolish thing. Means It will work once or twice But it will work maximum time It doesn't work When it catches the trend Let's understand Let's see Let's see more examples of divergence. Let's see here See guys Now, I can see There is a divergence RSI is saying It is saying RSI is saying. If you see the price It is trying to go up It is trying to go up If I pull it from this point If you come to this point. Till that point Okay Price is saying I will go up. RSI is saying I will go down This was the divergence Market should crash What happened? What happened? It went up So, what happens In this trending market Divergence never works It is fake Divergence New people get excited. That we have learnt something technical So If you are using Use the simple Strategy It will work But if you fall behind Divergence You will feel Everyday Divergence is made Trader is real Comment and tell I am telling the truth People have failed Spent a lot of money On divergence. I have put a video About divergence. In 2020 In 2021. I Honestly want Best for my subscribers Use the normal Strategy of RSI And that too Not on my saying Check it yourself And apply Price action On it Candle etc Okay so guys if you enjoyed the video. Then like it Indicator series Will continue The target of this video Price action Will not be seen by people I will make the target Small Only 7500 likes Will come 7500 likes New indicator I will put Maybe I want ADX indicator. To be combined With some other indicator I will combine Two indicators ADX and Let's see Which other I will combine I will put Next video on indicator. So Like it Subscribe If you are new You will get a lot. For Indian market For Forex market. This is my telegram channel If you add On this channel Market Guidance I can give you Okay Rest Later and. This series Looking good Let me know In the comment section. Free course Is it valuable Is it worth it. Let me know In the comment section Okay. I like it Making videos. For you Will make more Just let me know Through your comments Or likes. You like it or not Okay. Thank you so much See you in another video Bye-bye.