Stochastic RSI Trading Strategy — Transcript

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1. 0:00she is absolutely slaying it on a daily
2. 0:02basis making
3. 0:0310 to 20 000 a day trading us 30.
4. 0:07so the stochastic rsi a lot of you guys
5. 0:11want to learn about it i get it in my
6. 0:13discord chat
7. 0:14all the time in this video i'm going to
8. 0:16show you how to use the stochastic rsi
9. 0:19which settings you should be using and
10. 0:22on which
11. 0:22time frame so that you can have a clear
12. 0:24understanding of a better entry
13. 0:27and when the price is actually going to
14. 0:29reverse
15. 0:30or continue
16. 0:32[Music]
17. 0:34welcome back to the channel everybody my
18. 0:35name is artie and this is the moving
19. 0:37average a show where we discuss
20. 0:39everything day trading to keep you
21. 0:40profitable on a consistent basis
22. 0:42so there is a relative strength index
23. 0:45the standard
24. 0:46rsi then there is the stochastic
25. 0:49rsi and it basically is this formula
26. 0:52which i'm going to show you in the video
27. 0:54but let me explain it this way when the
28. 0:56standard rsi
29. 0:57is doing its flow it's only got peaks
30. 1:00you don't know when that price is
31. 1:02actually going to start coming down
32. 1:04whereas with the stochastic rsi it is
33. 1:07two
34. 1:07overlying percentage averages and so
35. 1:10when those lines
36. 1:11cross a lot of people use that as their
37. 1:13indication to get in
38. 1:15on their position so let's jump into the
39. 1:17charts i'm going to show you how to set
40. 1:18it up and i'm going to talk about the
41. 1:20basics of the stochastic rsi formula so
42. 1:23investopedia is one of the greatest
43. 1:25websites if you want to learn about an
44. 1:27indicator or how it works or how to
45. 1:29adjust the settings to get the best
46. 1:30results but essentially for the
47. 1:32stochastic
48. 1:32rsi it's taking the rsi minus the
49. 1:36minimum
50. 1:37rsi that it was in that time frame
51. 1:39divided by the maximum rsi
52. 1:42minus the minimum rsi so you can see how
53. 1:44it's taking multiple
54. 1:45averages working it in to make one
55. 1:48specific indicator there is
56. 1:50also another part of the stochastic rsi
57. 1:53which you'll see when we go into the
58. 1:54settings
59. 1:55but there's a k period percentage and a
60. 1:57d period percentage
61. 1:59the k period is the number of periods
62. 2:01used in the stochastic calculation
63. 2:03whereas the d
64. 2:04percentage is the number of periods used
65. 2:06when calculating the moving average
66. 2:08just so that you have a basic
67. 2:09understanding that this takes into
68. 2:11account a lot of averages
69. 2:13and percentages okay so now we are
70. 2:16looking at euro usd the most
71. 2:18commonly traded forex currency pair on
72. 2:21earth
73. 2:22i want you to pull up two things on your
74. 2:24chart two things alone
75. 2:26both free indicators that you can use in
76. 2:28confluence with each other to find a
77. 2:30great entry on a trade the first thing
78. 2:32you're going to have
79. 2:32is a 200 moving average you can use
80. 2:35smooth
81. 2:36you can use exponential it depends on
82. 2:38which currency pair i prefer smoothed
83. 2:40the next
84. 2:41indicator that you're gonna pull up is
85. 2:43the stochastic
86. 2:44rsi it is a built-in indicator put a
87. 2:47star next to it keep it on your
88. 2:48favorites list
89. 2:49now once you add that you're going to
90. 2:51get this big purple line with these
91. 2:53two overlapping red and blue lines
92. 2:56now i want to discuss these settings
93. 2:58really quickly and i want to tell you
94. 2:59how you can adjust them depending on
95. 3:01which time frame you are trading so
96. 3:04clicking on the settings you can see the
97. 3:06k percentage is three
98. 3:07d percentage is three rsi length is 14
99. 3:11which is the standard number for the
100. 3:13traditional relative strength index
101. 3:15and the stochastic length is 14. these
102. 3:17settings
103. 3:18are completely fine if you are trading
104. 3:2115
105. 3:21minutes and above so the 15 the 30 the
106. 3:24one hour the four hour or the daily
107. 3:26if however you are trading below the 15
108. 3:28minute time frame
109. 3:30you want to change the stochastic length
110. 3:32to
111. 3:33eight as you can see it made it a lot
112. 3:35more noisy but that's because we're
113. 3:37still on the 15 minute chart if we take
114. 3:39it down to the five minute
115. 3:40it smooths it out just a little bit but
116. 3:42for the purposes of this video we are
117. 3:44going to keep
118. 3:45the default settings and keep you
119. 3:47trading on a higher time frame which
120. 3:49means less false signals
121. 3:51keeping you more consistent so this is
122. 3:53not my strategy
123. 3:54if you are part of our discord group
124. 3:57you've seen in the testimonials
125. 3:59there's this chick christie she is
126. 4:01absolutely slaying it on a daily basis
127. 4:04making 10
128. 4:04to 20 000 a day trading us 30.
129. 4:08go look at the testimonial section in
130. 4:10the discord group but essentially people
131. 4:11were asking her about the stochastic rsi
132. 4:14settings i promised to make a video on
133. 4:16it that's why i'm discussing this with
134. 4:18you guys
135. 4:18basically what we're doing here is we're
136. 4:21looking for
137. 4:22continuations of a downtrend or an
138. 4:24uptrend
139. 4:25depending on if it's above or below
140. 4:28the 200 moving average so essentially
141. 4:31we're looking at places
142. 4:33like this finding resistance on that 200
143. 4:37continuing down
144. 4:38finding resistance on the 200 again and
145. 4:40continuing down but we're using the
146. 4:42stochastic
147. 4:43rsi to find our entry points all right
148. 4:46zooming this in a little bit closer you
149. 4:48can see that we're getting
150. 4:50a lot of resistance off that 200 and it
151. 4:52starts coming down so
152. 4:53people would see this normally and start
153. 4:56getting in
154. 4:56right about here just simply looking at
155. 4:59the price action
156. 5:00but if you had the stochastic rsi up you
157. 5:03would actually
158. 5:03see a crossover in the rsi so making a
159. 5:07vertical line right here
160. 5:08let's zoom it in and look at what the
161. 5:10price action is doing
162. 5:12versus what the stochastic rsi is doing
163. 5:14you can see we had this last ditch
164. 5:17effort momentum swing
165. 5:18up and then a completely flat top
166. 5:21starting the continuation down
167. 5:23this in itself is a very weak signal
168. 5:25it's not even an engulfing candle
169. 5:28but if we look at the stochastic rsi we
170. 5:31see
171. 5:31that at this point we had a stochastic
172. 5:34crossover
173. 5:35we wait to make sure that that's a solid
174. 5:37signal
175. 5:38this right here is three candles in to
176. 5:40the downside of the move
177. 5:42so you can clearly see that this price
178. 5:45is in the overbought territory of the
179. 5:47stochastic rsi
180. 5:49with the potential to continue to the
181. 5:50downside and that's exactly what you
182. 5:53got going on here and with the
183. 5:55stochastic rsi
184. 5:57maintaining this oversold market for
185. 5:59quite some time
186. 6:01this is just a heavy momentum grab you
187. 6:03could have gotten out on this first
188. 6:04stochastic cross
189. 6:06but i mean theoretically you could have
190. 6:07just maintained a trailing stop loss on
191. 6:09this
192. 6:10and gotten a nice decent move out of it
193. 6:12again using the stochastic rsi
194. 6:15alone would be very very difficult in my
195. 6:18opinion you need to overlay this with
196. 6:20multiple indicators
197. 6:21now again i told you that this is not my
198. 6:23strategy but one of the supplemental
199. 6:25tools that this person uses to get
200. 6:28better entries
201. 6:29is actually an indicator called the lmi
202. 6:31it is a paid indicator
203. 6:33and just like the stochastic cross
204. 6:35you're looking for a cross right here on
205. 6:37the lmi
206. 6:38i'm not going to go into this lmi
207. 6:40indicator on this video
208. 6:42but essentially they all work in
209. 6:44confluence with each other
210. 6:46if you want to learn more about this
211. 6:48head on over to our discord group
212. 6:50there's links to videos that christy
213. 6:52made that are phenomenal
214. 6:53and literally she slays the markets on a
215. 6:56daily basis so if you want to learn her
216. 6:58strategy
217. 6:59top to bottom front to back get in the
218. 7:01discord group
219. 7:02and follow the links in there i just
220. 7:04wanted to make a quick rundown video so
221. 7:06that you guys had some clarification
222. 7:07because there was a lot of questions
223. 7:09in the testimonial section about this
224. 7:11strategy if you guys are still watching
225. 7:13this video that means that you like the
226. 7:15video so if you wouldn't mind
227. 7:16hit the big thumbs up button down there
228. 7:18below my face and if this 15 minute or
229. 7:20higher time frame is way too high for
230. 7:22you and you want to scalp on the one
231. 7:23minute chart
232. 7:24check out this one minute scalping video
233. 7:26that i made that is just
234. 7:27absolutely legit and if you guys got
235. 7:29some value out of this video and you
236. 7:31like the way that i teach consider
237. 7:32subscribing to the channel by clicking
238. 7:34this button
239. 7:35right here thanks so much for watching
240. 7:36and we will see you in the next video
241. 7:41speak english dude