RSI Fakeout Strategy Most Traders Miss cTrader Indicator

RSI and stochastic are 2 of the most popular indicators available for traders. Each of them is great for specific market conditions. They both help identifying potential overbought and oversold conditions, and they help with the accuracy of a trigger— when exactly to trigger a trade, a buy or a sell. But what if I told you that there is a way to use them both not just combined, but One indicator that wherever you trade, on whatever timeframe you trade, you can actually see the indicator information from the higher timeframe. So in this video, I would be reviewing one indicator on cTrader platform that does that exactly. And by the end of the video, you would see exactly how to use that. And as always, I do not leave my followers with empty hands, but by the end of this video you will get the strategy that works perfectly, perfectly with this very indicator. Let's begin. So first of all, if you are new to our channel, welcome to our channel. Make sure to subscribe so you can enjoy all the extra tips we have here and this channel for you and all the educational video. If you are not new to this channel, I want to remind you, and also if you are new of course, that I created a dedicated playlist for cTrader platform specifically. Why cTrader platform? Here are all the reasons why this platform is superior to any other platform and is making on its way to the very top of this industry. And if you didn't watch this playlist I mentioned before, make sure you do. Right here you can see this playlist on this very channel. You would be able to see tricks and tips how to use the cTrader platform in the optimized way, but also you would learn also fun, super powerful, fantastic tricks, tools, methods, and strategies on how to implement that on cTrader platform. So make sure you watch the playlist on this very channel. So in this video, I would be reviewing an indicator from cTrader store. That's part of the videos I wanted to do for you, the followers and the viewers. So for those who are interested in this kind of tools, helpful tools, you can see exactly how from my point of view it should be done properly. So let's go to the store. Together. So when you go to the C-Trader store, and I'll put the link in the description for you so you can just follow the link and get to this indicator directly, you go to the indicators and then you choose this indicator. It's called the Vega XLR, which is the RSI and stock RSI combination and alerts. Hey, uh, this one at the moment is $25. There are usually discounts or promos, just follow up. And if you love this indicator, and I really believe you will after watching this video, when you purchase that, all you have to do is just get that and install that on your platform. And after the purchase, you— and the installation, you would have that saying installed. Then what you have to do is to go to the platform itself. Once you are in and make sure there is synchronization between the platform and your account, go to the indicator section and find this indicator. I already used that, so it's, uh, on the recent for me. But if not, you will find it under the installed section. So just choose this one, and here you have all the control you need. It starts with choosing where you want it— on the chart or the new panel. I like the new panel because I love to see it separately on the bottom. If you want to receive alerts, you click, uh, stop alerts. Of course, no or yes. For now, I'll just stop it. And this is a great tool added by the developer which is a user guide. If you need to make sure to understand how to use the indicator, you can add the little sign question mark there. I will just remove that, but you can of course include that. Mode— if you want the RSI or the stochastic RSI, you can use them both. I will be presenting RSI, but again, both are absolutely fantastic, and I'll show you how it looks like. And this is the powerful thing— if you choose the time frame chart That means it will be presenting you the information on the time frame you trade. So if for me it is 15 minutes, that means I would get the information for the indicator of 15 minutes. If I choose alternative and then I choose which time frame I want to see, let's say I want a 4-hour chart, okay, because I love to see the overbought oversold conditions for the, um, higher time frame. Okay, so I choose which time frame I want. Now I choose on the indicator. So the RSI periods, I love to go with the 14, which is the by default, but you can leave the indicator 20 as it is. And stochastic, I love 8 or even 5 like the original stochastic is. Overbought, oversold are set for 80 and 20, which is perfect, but also you can go with slightly less aggressive 70-30, which is also, uh, very good. You can choose the alerts of course, and then also the pop-ups and all the other important things you have here. Once you click, uh, add to the chart, this indicator with all the settings you designed and defined would be presented for you here. So here is the indicator. Now pay attention, if you stand here, you will see that this is applied for the 4-hour chart. So I'm on the 15-minute, but I actually see the information from the 4-hour chart. So how do I like to use this indicator in a moment? But also look what happens if you want to see the RSI stochastic. Uh, so Stock RSI, sorry. So you go to the indicator and go here to the properties, and then you can choose if you would like instead of the Stock RSI. And then what you would get here is this representation. So again, they both are absolutely fine to work with. I will be presenting with the RSI, but you can also do that with the Stock RSI. So let me just go back and revert back to the RSI. And now I want to show you how this indicator helps so much. So it helps you to remember the main tool is to first of all give you the overbought oversold combination between the RSI stock RSI. But I love the way it it gives me to to show me. What happens on the higher timeframe from the one I work with. So if I trade 15 minutes and I want to see what happens on a higher timeframe, it's right there for me. So now I want to show you the strategy, how this is super powerful. So one of my preferred ways to trade is fakeouts, which could happen in 2 ways. First way is the classical fakeout when the market makes lower highs, lower lows, and then failed to hold. So it makes the low and then pulls back right away. As long as the low would be holding, I would be looking for the pullbacks and the buy. But first of all, it happens with a fake out, fake low, bounce up. And as long as the low holds, I would be looking for the buys. I will present it in a, in a moment. Of course, if it's a bullish market, then I want to see fake high created here. And then as long as the high holds, I would be looking to sell these rallies. So this is one way to trade fakeouts. Second way to trade fakeouts is actually when the market is in trending structure. And as long as the low holds, the market makes pullback, cleans one of the lows that we have on the trending structure, making fake breakout and pullback. And that gives phenomenal signs to trade. Okay, so that's exactly what we would be looking at. And now I want to present how it looks like and how to trade with that. So here is the very first method. As I explained before, we have lower highs, lower lows on the market. And here is— look what happens here. This low was broken, but the market bounces back. Okay, so that's a very strong sign. But most importantly, all that happens when the higher time frame RSI is oversold. So we got the move down, we got the higher time frames. Remember, this is the 4-hour chart we saw here. Then when— this is the 4-hour right here, as you can see. Uh, remember, we choose that in the settings, right? So We got the oversold from the higher time frame. We got the fake out on the 15 minutes. And as long as this low holds, here is the next thing I would be looking at. I would be waiting for the RSI to climb above 50. Remember all that, as long as this low holds. What I want next is the RSI to get— go above 50. Why? Go in the bullish momentum and bullish control zone. Go back below the 50 for the pullback. All that as long as the low holds. And after that, what I am looking at is the fake out one more time. So look what happens here. This low, the first low is holding. Now I got the pullback after the RSI was above 50, which was already in bullish market. I want to pull back and I want the fake out. So once this fake out happens, look at that fake low. This is lower low which immediately fades and bounces back. And once that happens, look for the RSI crossing above 50 to give you the ultimate momentum call, which happens right here. And then usually you got fantastic opportunities with smaller risk. Much bigger rewards. Always aim to the next key levels you have on higher timeframes like support, resistance, supply, demand, and make sure you got at least 1 to 1.5 or ideally even 1 to 0.2 risk-reward ratio. So this is one of the ways to trade the fakeouts. I absolutely love that. Now I want to show you how that looks like on the opposite direction. So at the end of bullish market, when you get higher highs, higher lows, Look for overbought conditions, which means above the 70 with RSI or stochastic RSI combination. Both are absolutely fine. Get the fake out, of course, and wait for the RSI to get to the 50. Below 50 ideal, but even the retest of 50 is good enough when you have your bearish market structure. After that, what you would want to see, of course, as long as this high hold, you want to see the pullback, which happens here. After the pullback, you would want to see fake out again, right? So that's how you know that the buyers are getting tired— fake high and the bounce back. And when then the RSI crosses the 50 one more time, you got your sell alert, which happens right, right here. As you can see, it happens, right? So This, of course, your invalidation zone, but you also— all the most important thing is as long as it stays above the main peak there. This is the invalidation, the recent high, right? So when you get that scenario, usually you got the opportunity to enjoy a great risk-reward ratio, at least 1.15. It may— majority, I would say, of these setups would even give you more than 1 to 2. Always aim for the next support or resistance, demand or supply on the higher timeframe. So this is one of the favorite ways I have to trade the fakeouts. But I want to show you also a way how to trade the second fakeout as I showed you before. So here is an example. This is oversold conditions. Now remember, what we are looking at is bullish price structure after oversold conditions, pull back to clean one of the lows of this bullish structure. As long as the first low hold, after that happened, we are looking for the fake out and then get the Uh, left. So here is how that looks like. We got the bottom and the oversold conditions from the 4-hour chart. After that, what we are looking at is the market to make sequence of higher highs, higher lows, and most importantly, for the RSI to cross the 50, go back to the bullish zone. So it makes the low, high, low, high, and then it goes, makes the pullback. Now look And this is the low, and this is the low, right, of this bullish structure. So once again, low, high, low, high, low, high, low, and high. So this is the key low, this is the key low, this is the key low. What I want then is that as, as long as this low actually holds, right, uh, what I want to see is the price going to clean one of these lows with RSI bouncing below 50 to the seller zone and then faking out. And once you get this fake out, happens to be here, right? Go and goes above that. That's your sign. That's your thumbs up that the buyers are very likely to shoot and take the control back. Of course, when the RSI changes positive one more time, it gives you the extra points. But that gives you a great understanding. Where is— sorry, it's right here. Uh, and this was the trigger. Then the RSI also crosses above 70, and that's where you get your risk-reward ratios. So this is your risk because that's the recent low after the fake out, and usually You would see the market pushing to the next key levels. We have the broken support acts as resistance and high that acts as supply. So this is the ideal target zone. If this is your risk, you usually will get the reward at least 1 to 1.5, but most of the times even above the 1 to 2 risk reward ratio, which turns that super. Strong risk-reward ratio and strategy to use. So go and check out this indicator. The combination of trading one time frame, checking the higher time frames, following these fake outs, getting the alerts when things happen, levels crossed—it's exactly what you would want in your trading. If you are using the C-Trader platform, of course, then this is an indicator. Consider. From my point of view, I think it's very useful. That's the bottom line. So as, as I mentioned at the beginning, as part of my playlist, I would be reviewing great tools. There are so many tools in cTrader, uh, store, and you have the link below that you can go there. You can choose— look at that, over 1,000 products. I would be reviewing the ones that I consider, uh, to be the most useful. Or potentially useful, uh, for you. And that's why, uh, one of the indicators I wanted to review is this one, because I found it really, really, really useful with the combination of the multi-timeframe scan, automatic scan while trading on a lower timeframe. I think it's fantastic, and I wanted to share with you the strategy that will help you to trade this indicator. So I really hope you find value in this one and in the strategy. If you do, don't Don't forget to hit this like button and make sure you watch the CTR playlist so you can get all the other important tips and tricks and methods and strategies that I have there for you. Thank you very much for your time. If you have any questions, don't hesitate to ask in the comment section. I wish you all the very best and I'll see you soon with more. Good trading. Bye for now.