[00:00] Yesterday I showed you the strategy that I trust the most, and today you will actually watch me take this trade with this strategy in real time. If you guys trade RSI divergences like I showed in yesterday's video, like this example that just fired on the chart on EURUSD on a one minute time frame,
[00:19] the one thing that you need to keep in mind more than anything else on the entire planet is the time of day. We get so lost in the charts and trying to analyze things that when you see some setup and you're like, cool, this is perfect.
[00:32] I'm going to get in. Everything's fine. You forget that it's like 8.58 a.m. And then you get into a position two minutes later. It starts going crazy. The volatility makes no sense.
[00:45] All of the structure is broken because before that it was low volume, low volatility. And now the market's open and it's nuts. geez, I can't even do this without glasses anymore. Now, this trade that fired right here,
[00:58] with the regular bearish divergence, I didn't get in right away, because I had to take my kid to school, and I just got home. It's raining in traffic with a pain in the ass. But now that I'm down here, in my trading dungeon, I realized that it was like 8.50.
[01:11] The Frankfurt session's about to start in Germany, same time zone as me. And I was like, dude, that's a pretty strong divergence, man. RSI peaked out of the 70 range. The next high is deep within the 70-30 range.
[01:25] And all I wanted to do, I just got into this trade. It went against me for a little bit. But all I want to do is hold this until the RSI gets down here to the 30 range. And then I'm out. So basically what I did was I entered right here.
[01:37] And I put my stop loss between these two right here. This high and this high. I don't know where my target is. All I want is that RSI to get down to the 30. I think it's healthy trade. It's got good structure.
[01:49] Bullish momentum. died off with the divergence, breaking down below previous structure. And you can see it's maintaining that bearish structure. Love in the shape of this move. Everything is good. We don't
[02:02] even have any high impact news right now until like the next five hours. So I'm going to let this roll for a little bit and we'll see what happens. Because trading is boring and the best thing that you can do is wait In the meantime I clean my desk And this is where I think a lot of traders actually hurt themselves Because once you in a trade suddenly every candle feels important
[02:23] You get a candle going against you and you start thinking, maybe I should move my stop. Then price moves in your favor. And you think maybe I should take profit now. And then there's pullbacks a little bit and suddenly you're questioning the entire setup.
[02:38] But none of those things were part of the plan when you entered. You're basically making new decisions every 60 seconds based on whatever the last candle did. And I've done this enough times to know that for me,
[02:52] sometimes the best thing I can possibly do is just get away from the screen. So that's literally what I'm doing here. I'm cleaning my office. The trade doesn't need me watching it. My stop loss is already there.
[03:05] My risk is defined. I know exactly what I'm waiting for. If this trade hits my stop, then I was wrong, and that's fine. That's what the stop loss is there for. If price continues moving in my direction, I'm going to let it do its thing until the reason I plan to exit actually happens.
[03:25] And I think that's an important distinction. Having discipline doesn't always mean doing something. Sometimes discipline is not interfering with the plan. It's allowing the trade you planned before all the emotions kicked in to actually play itself out.
[03:41] So I'm going to shut up now, speed this up, clear the disaster of an office that I have, and we'll see whether the price gets down to that RSI 30 level, or maybe I'll just showcase a huge failure.
[03:53] Either way, this is going to be valuable content for you guys. all right so rsi currently right now is 31.9 and my target was 30 so we've had some nice
[04:10] bearish momentum i mean it took a while it consolidated for a little bit but this is a really nice healthy move because of that divergence and because the market is opening And when the market opens, it chooses a direction for the day usually or at least for the session.
[04:28] So now that we at 31 on the RSI I think it a nice healthy level to close so what I gonna do is I gonna open up my mt5 account you can see I in profit
[04:44] zoom this out to the five minute chart you can see that's where I entered and right now it's here at previous structure you know we're oversold if you want to see that on the one minute chart you can see I entered and then we had
[04:58] that spike up and it's been going down ever since. So it's a nice little exit area for me. Huge profit on the account. I mean, it's a $122 account, so I'm happy. And that's kind of how I
[05:12] want you guys to trade. I want you guys to trust the buyers and the sellers. And I want you to trust their interest in the market. You are not trying to guess which direction the price is going
[05:26] to go. You are following the momentum. And following the momentum means being able to read between the lines, being able to see when buyers don't want to buy anymore. You want to see when
[05:42] sellers are no longer interested in selling anymore. The RSI is a momentum indicator. People that are heavy sellers aren't usually going to get into new sell orders at the bottom of the RSI
[05:56] range on that specific time frame. They're going to get in when the buyers are already exhausted. The buyers were exhausted here. They were no longer interested in buying, bringing the price up.
[06:09] So that's when sellers get in and they take it down until they've run their race, their section of the chart. And that's what the RSI tells you. It goes out of the range when price is going up
[06:22] above the 70 range, and then it goes down below the 30. And now the buyers are going to look into getting into price at these levels. But they're also going to wait for the sellers to get exhausted.
[06:35] So there's going to be a little bit of buying pressure like there is right now at the 30. Sellers might get a second wind to push it down, but they're not going to push it down enough. and we probably end up seeing another RSI divergence here as price potentially makes another lower low and then goes up while the RSI makes a higher low And that going to be your bullish divergence for a long position
[07:02] I really wanted to make this example for you guys so that you can see not only one how boring trading is, but how you just have to be in the market and sit on your hands. Because most traders
[07:14] when they see chop like this, they would have been stopped out here, stopped out here, and this back and forth makes them start buying and selling without trusting the direction of the previous signal that the market's buyers and sellers were showing you. Loss of interest in buying and loss
[07:32] of interest in selling at specific levels based on the RSI, which is the momentum of the markets. That's the whole point of this video. I just wanted to show you a real-life example of a
[07:44] real-life trade on a real-life small account and how all it takes is the ability to identify something, trust that you've identified it correctly, and wait for a specific target
[07:56] that you've predicated based on the momentum, based on the interest of buyers and sellers. I feel like it was important to make this video to show you guys the process of trading and how you use your knowledge to identify what the market is doing. And what the market is doing
[08:14] is what the buyers and the sellers are doing. They're always both active all the time. They're just looking for their opportunities. And when enough of them start doing it, you just follow their coattails.
[08:26] Don't try to get a zero drawdown trade. Don't try to time the perfect market. Watch the momentum. If bullish momentum dies off, that's when sellers get interested. Once they start selling, that's when you should get interested.
[08:39] And you know that sellers get less interested on the bottom part of the RSI range, as we saw in the example on the chart. And that's why I held the trade without a defined take profit, but manually closing when RSI hit the 30 level.
[08:54] You do this consistently, week after week, month after month, year after year, you'll be in a good position. If you want the full in-depth tutorial of this trading strategy, watch this video right here. Make sure to share this video with your friends. Thank
[09:06] you so much for watching, and we will see you in the next one.