---
title: 'I Became Profitable With This Trading Strategy'
source: 'https://youtube.com/watch?v=o5i0yWkYfuI'
video_id: 'o5i0yWkYfuI'
date: 2026-07-18
duration_sec: 662
channel: 'Alex Ruiz'
---

# I Became Profitable With This Trading Strategy

> Source: [I Became Profitable With This Trading Strategy](https://youtube.com/watch?v=o5i0yWkYfuI)

## Summary

This video presents a simple trading strategy using Bollinger Bands and RSI to identify mean reversion opportunities. The creator explains how to set up the indicators on TradingView, enter trades when price touches the outer band with a confirming RSI reading, and manage risk with stop losses and take profits. The strategy is demonstrated on daily and 4-hour timeframes, with an advanced divergence technique also covered.

### Key Points

- **Strategy Overview** [00:01] — The strategy uses Bollinger Bands and RSI to trade mean reversions. It is simple and helped the creator become profitable.
- **Bollinger Bands Setup** [00:15] — Bollinger Bands consist of upper, lower, and middle bands. Price stays within bands 90% of the time. Set length to 30, standard deviation to 2.
- **RSI Setup** [02:10] — RSI length set to 13, overbought at 70, oversold at 30. This confirms overbought/oversold conditions for entry.
- **Mean Reversion Concept** [03:05] — The strategy seeks a return to the middle moving average after price touches the outer band. Enter short when price touches upper band and long when touches lower band, but only with RSI confirmation.
- **RSI Confirmation Importance** [04:38] — Without clear overbought/oversold RSI reading, entries can lead to losses. Example shows three losses without RSI confirmation, then a win with it.
- **Advanced Divergence Technique** [06:25] — Divergence occurs when price moves one way but RSI moves opposite. This can signal a reversal even without band touch, combined with a reversal candlestick.
- **Best Timeframes and Assets** [08:17] — Strategy works best on daily and 4-hour charts, especially in trending markets like EUR/USD. Avoid ranging markets.
- **Backtesting and Demo Account** [09:10] — Do not trade live without thorough backtesting. Use a demo account to test all aspects and adapt to your personality.

### Conclusion

The strategy is effective when combined with RSI confirmation and proper risk management. Backtesting and demo trading are essential before risking real capital.

## Transcript

fairly simple and easy-to-use trading strategy, so simple that I myself was able to become profitable using it. The strategy works by using a Bulllinger Band and an RSI, two
really useful indicators. It's simple, easy, and most importantly, it generates is talking about the two main components of the strategy: the Bulllinger Bands and
the RSI. The Bulllinger Bands are a historical indicator that acts very well as dynamic support and resistance, following the price wherever it goes. They were created by John Bulllinger, an analyst and trader, in 1980 and
consist of three bands: an upper, a lower, and an intermediate one, where more than 90% of the time the price stays between them. I'm going to give you a spoiler to show you how you can make
money by taking advantage of the moments, that is, the 10%, when the price doesn't lower band. So, we go to TradingView, we go to this top left where it says " Indicators," we click, and in the search bar
we type "Bullinger Bands." Our indicator will then appear; we click on it, and these bands will appear: the upper band, the lower band, and the middle band. What we have to do next is double-click to
edit them. The default parameters are already correct, but for this strategy, we're going to set the length going to set the length to 30. We type 30 and press Enter and
make sure the standard deviation is set to two. We click OK, and now we have our Bulllinger bands set. As I said, we already have the central part, which is a moving average that, since we set it with a length of 30,
moves according to the range of the last 30 candles on the chart. The outer bands, in contrast, are standard deviations. Okay, now we have the Bulllinger bands set. Now let's go for the RSI.
Indicators," and in the search bar, we type "RSI" or "Relative Strength Index" (whichever you prefer). We click here, and our indicator will automatically appear. We're going to
certain parameters. Again, the parameters that  The default settings are more than correct, but for this specific strategy, we're going to review two things. First, the RSI length should be 13, not 14. Press Enter to
accept. Second, the overbought portion should be at 70 points. We can see that here as well. And the oversold portion should be at 30 points. We can see that here too. At this point, we have both
indicators set up, and we'll move on to the next step. The basis of the strategy centers on a technical concept called minute reversal. Minute means average, and reversal means returning to. So, by definition, what we're going to
look for is a return to that moving average located between the upper and lower bands of the Bulllinger Bands. There are many times when the price makes a large upward or downward move, and what it does
even break through it. So, what we're going to do is try to enter before the price reconnects with that intermediate moving average. This means that when the price touches the
upper band, we'll go short.  When the price touches the bottom, what we'll do is go long, easy and simple, right? Well, the way, you're going to lose money. Now, the first thing I'm going to do is show you
how to make the strategy profitable, and in the final part of the video, once you know how the strategy works, I'll show you a technical detail to make it even more profitable. Look
at this part of the chart where the price not only touches but also breaks the upper Bullinger band several times. Although it forms interesting drops, it doesn't clearly break the
intermediate moving average, and it's not until the last situation where it breaks it forcefully. If you had entered in any of these three previous positions, until the price decisively breaks that moving average, you would have
had three consecutive losses. But do you know why in this fourth and final situation, not only is the upper band broken, not only is there a rejection of it, not only does the price not reverse and go in the opposite direction,
but the intermediate moving average is also decisively broken? Simply because the  The RSI has now been clearly showing overbought conditions, and this is precisely what we want to see: not only that the price
separates from the moving average and touches the sideways band, or even breaks through it, but also that there is a clear overbought or oversold reading on the RSI. we enter. For example, let me show you another example. In this case,
we are already seeing a breakout above that band, but at no point do we have a clear overbought reading on the RSI. So, what I'm going to do is wait for the price to develop. It continues to rise; now we
So, the moment the price starts to fall, what I'm going to do is execute a short position. Let's see what happens: it continues to rise, it continues to starts to slow down, and at this moment it starts to fall. What I'm going to
sell order. In this case, as you can see, I already have the sell order placed. The stop loss is above the high, and I personally placed the take profit at... The intermediate part, that is,
the moving average, anyone who wants to be more aggressive can try to see how the price reaches the lower band. I'll leave that up to each individual's preference. Once we have all the parameters
is let the price follow its course and let the probability of this strategy reach the Take Profit. In this case, I would have exited perfectly with a little over 1% profit,
but someone who wanted to extend it to another level could have even But there's a slightly more advanced way to execute this strategy, and that's by adding a new concept called divergence, which is precisely what I'm
Also, if you're enjoying this video and you like this type of content related to specific trading strategies— strategies that I've tested throughout my life and that have worked for me, even allowing me to become
profitable with trading—you can leave a like if you're enjoying it, and leave a comment about what kind of content related to this.  With other types of trading content, you'd like to see a divergence. A divergence
forms when the price is moving in one direction, but the RSI is moving in another. For example, look here: the price is rising and continues to rise, but the RSI is showing a clear divergence as it's falling. Well, what
ends up happening is that the price reaches what the RSI was already indicating, that is, forming a clear drop. So, another way to see that the price is moving in a specific direction, but the
RSI is moving in the opposite direction. When we see a reversal candlestick, we're going to execute that strategy regardless of whether the band has been clearly broken or not. That's why it's
a slightly more advanced strategy because it leaves some details open. experience, you can understand that even if the upper boundary hasn't been broken, as in this case, the RSI is forming a bearish divergence. And this, combined with the fact that
a bearish candlestick pattern has formed, gives us the perfect scenario do right now is place the sell order and let the price run its course. Stop loss above the previous high. Take
profit, in my case, in the middle zone, at the intermediate moving average. And everyone can exit wherever they want. I would have made this profit, and someone else might have gone even lower. Before you ask, this
strategy works best on the daily and 4-hour timeframes. Personally, the way I've used it and been profitable is on the for it. Obviously, it works much better in
trending movements than in ranging movements, so it will obviously work better on a daily chart of the euro/dollar than on a 4-hour chart of Bitcoin, for example. But the idea is that you
move between those timeframes— daily and 4-hour charts—and between assets that are directly in a trend, whether it's an uptrend or a downtrend. Something very important: I don't recommend anyone go directly
to the market to use this strategy. I personally was profitable now I use others.  The reason is simple: I like trading, I love it, I'm passionate about it, and I want to learn everything I can. So now I'm using
one strategy, and later I'll use another. A few months ago I was using others, and I'm going to want is to learn as much as possible about what you have to do. So you start very basic, very simple, standard rules that are sufficient, but I haven't
talked about position sizes. I don't know what target works best for you, what stop loss you feel most comfortable with. What you have to do is backtest and test everything: rules I 've mentioned and rules I haven't
mentioned, timeframes, assets— literally everything. If you want to make money with this, treat it like a professional, treat it like a business. If you want to risk your money on something, the least you can do is control
each and every aspect that makes up that something. Therefore, master all the aspects that comprise this strategy. I don't recommend anyone, under any circumstances, go directly to the market to risk their
own capital without having 100% tested all the important points of this strategy or of any other.  None, obviously. You can't go around like a crazy goat because you'll get put in your place. Find a demo account and try it out, try it
for months. Hey, you're feeling lazy? That's okay. Welcome to the 95% club of traders who aren't profitable and never will be precisely because they engage in these kinds of situations and actions; they don't take
things seriously. So, get a demo account and try each and every aspect. Make guesses, try different approaches, try different methods, change things, and most importantly, adapt it to your personality. Remember that below, in the
find different links of interest that will help you continue learning in different ways in the world of trading—all free. So, I'm going liked it, that it was useful, which is the important thing. If so, like it,
subscribe, share it with friends and family, and I'll see you in the next video. family, and I'll see you in the next video. Goodbye.