3 Reversal Indicators That Scream SELL
40sReveals a precise, rule-based reversal setup that traders can immediately apply.
▶ Play ClipAI Summary
This video demonstrates a short-term trading strategy for binary options using a 1-minute chart and three indicators: a resistance zone, a zigzag indicator, and the Relative Strength Index (RSI). The presenter walks through a real trade example, showing how to identify a reversal signal and execute a sell trade with a two-minute expiry.
[00:01]
Resistance Zone Identification
The chart shows a strong resistance zone, indicating a price level where selling pressure is expected.
[00:01]
Zigzag Top Formation
A fresh top in the zigzag indicator signals that the upward move is losing momentum.
[00:16]
RSI Divergence
The RSI touches the 70 level and turns downward, indicating fading buying strength.
[00:16]
Rejection Candle
A candle with a long upper wick appears near resistance, confirming rejection from the top.
[00:29]
Entry Execution
After one bearish confirmation candle closes, a sell trade is entered on the next candle with a two-minute expiry.
[00:44]
Trade Management
A small upward move after entry is normal; the trader stays calm and trusts the setup as sellers take control.
[00:58]
Profit Outcome
The price stays below the entry level by expiry, and the trade closes in profit.
The strategy relies on confluence between resistance, zigzag top, and RSI weakness to generate a high-probability reversal signal. Patience and trust in the setup are key to letting the trade play out.
Tutorial Checklist
5
00:29
After one bearish confirmation candle closes, enter a sell trade on the next candle with a two-minute expiry.
Study Flashcards (5)
What three indicators are used in this reversal strategy?
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What three indicators are used in this reversal strategy?
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Resistance zone, zigzag indicator, and RSI.
00:01
What does RSI touching 70 and turning downward indicate?
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What does RSI touching 70 and turning downward indicate?
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Buying strength is fading.
00:16
What candle pattern confirms rejection from resistance?
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What candle pattern confirms rejection from resistance?
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A candle with a long upper wick.
00:16
When is the sell trade entered?
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When is the sell trade entered?
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After one bearish confirmation candle closes, on the next candle.
00:29
What is the expiry time used in the example?
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What is the expiry time used in the example?
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Two minutes.
00:29
💡 Key Takeaways
🔧
Confluence of Indicators
Combining resistance, zigzag, and RSI provides a stronger signal than any single indicator.
00:01
📊
RSI as Momentum Gauge
RSI at 70 with a downturn is a classic overbought signal, but here it's used in a short-term context.
00:16
⚖️
Patience in Trade Management
Trusting the setup and avoiding interference is crucial for letting the trade reach its potential.
00:44Full Transcript
[00:01] channel showing a strong resistance zone. At the same time, the zigzag formed a fresh top telling us the upward move was getting weak. Now look at the RSI. It touched the 70 level and then started to turn downward. This showed
[00:16] that buying strength was fading. Finally, a candle with a long upper wick appeared near the resistance showing clear rejection from the top. After one bearish confirmation candle closed, we entered the sell trade on the next
[00:29] candle with a twominut expiry. After placing the sell trade, the price made a small upward move for a few seconds, which is normal in reversals, but very quickly the market failed to make a new high. Sellers started to take control
[00:44] and the candles began to move away from the resistance zone. At this stage, we simply stayed calm, trusted the setup, and did not interfere with the trade. By the end of the two-minute expiry, the price stayed below our entry level and
[00:58] price stayed below our entry level and the trade closed in profit.
