Simple Beginner Forex Strategy (+$8531)

Do you want a simple but powerful Forex trading strategy? Because today I’m going to let you in on a little secret Fibonacci and RSI trading strategy that can turn a beginner into a pro. I’m Pat, I’m going to teach you how to use this strategy, and then I’m going to trade it on a live trading account for the next two days to show you it works. 

Simple Beginner Forex Strategy

Today’s simple Forex strategy is using the relative strength indicator to tell us when the market is overbought or oversold. If the RSI shows a value over 70 it’s over bought. And if the RSI shows a value under 30 it’s oversold, both of these numbers signify key points in the market when there could be a reversal. So that’s when I slap on the Fibonacci indicator and cash in on the retracement. Often traders like to use the Fibonacci indicator in different way. They want the continuation, but in this case, I want the retracement and I’m going to capture those pips. So let me open up a chart and show you what I mean.

Installation & Strategy Rules

Okay. So let’s get into the trading strategy. The first thing I need you to do is come to www.tradingview.com. This is really easy. All you want to do is go to the indicator section right here, and you’re only installing one indicator, the relative strength index, simple it’s on the chart. Now, I just want you to edit it, make it easy for yourself. Style it, make it yellow for the upper band, make it yellow for the lower band. This is going to make it really easy for you to see when we are over bought like this, or when we are oversold. When we get below that yellow line, and that’s really important, I’ll get into the rules next. 

Now that you have that, what I want you to do is pull up the Fibonacci retracement. Okay, Just throw it on your chart Like this, that’s simple. It’s going to look much different. So what I want you to do is just double click on it. You can pause here and you can copy my settings. These are all that I use. 0, 0.382, 0.5, 0.618 and 1, these are the most common Fibonacci retracement. So it’s really all that you need. Then what I have is just use one color. I have the levels in percent’s and I put the labels on the right hand side. I think this is just the easiest way to see it. And now you have the strategy on your chart. So let me get into the rules.

So now I’m going to show you the rules of this simple forex strategy. So you know when to buy and when to sell. For our entries, we are really focused on the RSI indicator. And only that indicator. You see here, this is overbought. So we would be looking for sell opportunities. If I scroll back through the RSI, you could see again, right here, this is overbought. We would be looking for sell opportunities. And if I scroll back far enough, we can see that right here, This is oversold. So we would be looking for buy opportunities. I’m not using the Fibonacci the way a lot of people use it. There’s multiple ways of using it. For this strategy, I’m actually using the Fibonacci to capture the retracement.

 Let me actually go into show you an example right now. Okay. So here we have a trading example. So let’s take the Fibonacci retracement. You could see it on the left side of your trading view. Then you’re going to put it at the bottom of the wick at the beginning of the impulse, and then you’re going to put it at the end of the impulse right here. 

So now we have our opportunity. And so this is coming right here, right? We have the RSI right there. It’s showing it’s over bought. So what I’m doing is I’m plotting the Fibonacci on the chart to give us our exit points, right? So 50% is actually what hit here. That’s what won the trade. You can also use 38.2 or 61. This is something you can do when you following your trade, just take a look. What’s happening. Is the candle breaking through? Look, the candle right here broke through. So I thought, all right, maybe I’ll go for more. I’ll hit the 50. So I took the 50, I got the profit. I got out of the trade. So now I’m going to live trade this trading strategy for the next two days and see how much money I can make, Just picking up the retracements.

Simple Forex Strategy Trade #1

Let’s jump into my first trade using this simple forex trading strategy. You can see here, the RSI is above 70, which means it’s over bought. So I’m looking for a sell position. I’m looking for the sellers right here to give a little bit of a push and then retrace the market here before it rebounds back. 

So the next thing I do is I hit the Fibonacci retracement. So I grab this, I put the Fibonacci retracement at the bottom of the wick and then at the top of the wick right here. And then I drag it across and then we have our take profit levels. What a lot of people do is they use the retracement like this, and then it’s going to hit the 50, or it’s going to hit the 60. And that’s where they’re going to use their entry. But what we’re doing is we’re using the RSI for our entry, right? So we see the, it’s over bought right here. So we want the sell trade. This is what I have. This is the sell trade that I chose. I put a 50% take profit. Let’s take a look and see what happened with this trade. It was a bit of a slow trade. It went for about 17 hours, but you can see it’s going in my direction. It’s a really, really good trade. And I do end up smashing the take profit. I could have hit the 61.8. Maybe that’s what I should have done on this trade, but I wasn’t watching it close enough. I probably should have trailed it and got that extra profit. But this banked me 28.2 pips, $2,811. And before I go, I have to tell you for the stop loss. I put the stop loss originally, just above here, just right above the last high, right? This is the last high right here. So that’s where I put the stop loss. You don’t see the stop loss here because I turned it to break Even, I made it break even somewhere when I was around here during the trade, because I just wanted to lock in those pips. So that was the first trade. You can see how it works. Let me show you the second trade. Let’s see how much I made this week.

Simple Forex Strategy Trade #2

Let’s get into trade Number two. If you’re struggling at all with the strategy, feel free, leave a comment. I will always get back to you. I respond to all my comments, I guess I just don’t have a life. Let’s take a look at this second trade. You can see here, We have the RSI above 70 again. So we are looking for another sell trade. This trade I kind of screwed up on. You can see here. I got in the trade right here. I should have been getting in right here, but let me just backtrack a second here. You can see here we are over bought. So I’m looking for that sell trade, right? The next thing I do is I grab the Fibonacci replacement. I go from the lowest level here to the highest level here. So you can see, I felt that this was going to go to the 61.8% mark. So that’s where I put my take profit. My stop loss sucked on this trade. I really sucked on this trade in general. Let’s just go ahead and I’ll show you exactly what happened with the trade. You can see here, it went in my direction and it smash my take profit, right? Boom! I win $1,158, but it was just eight pips. It wasn’t a good trade. 

Honestly, what I should have done is entered the trade right here, because this is where it was over bought. And then we would’ve got all of these pips, but sadly, I just wasn’t looking at the chart, I got in late. I saw the opportunity late. I still got the win. You know how it goes sometimes, this is why I’m doing these live trades to show you how trading actually is. Let’s get into trade Number three. It’s going well so far. Let me show you the next trade.

Simple Forex Strategy Trade #3

Let me show you trade number three, with the simple forex trading strategy, you can see here, right we are breaking above 70. We are over bought. Again, I should be placing my trade up here. I placed it down here. I’ll get into the details. 

So first thing you want to do, grab your Fibonacci retracement, put it at the bottom, put it at the top, swing it across. Okay, bingo. Now we have our target profits. This one, I didn’t really do a great job on, it is what it is. I’m telling you when you trade live things change. Let’s just take a look and see what happened with this trade that I placed. And then I’ll give you more of a breakdown. 

So you can see it goes in my direction. It triggers in a little bit here. This trade was a little bit longer than the other ones, but I did end up winning this trade and I banked $1,730. So it was a really good win in the end, even though it did take a while to get at there. And it wasn’t exactly the best entry that I had with all of these trades. 

You can see here, I banged the winner. I got my $1800 or $1,730. So I was happy with the trade, but I wasn’t really following my rules here. Obviously it was over bought. So I was looking for a sell trade. I put my Fibonacci retracement on, but really I should be trading this retracement from here, right? This is where I should be trading it from. Maybe I should just be picking up this or maybe I should be picking up all of this. And then it’s a much better trade. Let me jump into trade Number four, it did much better. And then I’ll up with some live trading results. 

Simple Forex Strategy Trade #4

For my fourth and last trade you can actually see here, I am oversold here. I am oversold here. You can see, I set my stop loss right here. I always set it below the most recent low. Okay, So with the oversold here, the oversold here, I’m looking for a buy trade for the first time. So what do I do? I get my Fibonacci retracement. I put it at the top right here. I put it at the bottom right here. Bingo! It was something, I think I used this one right here. 

So what I did is I have, again, I have it at the 50%. This is at the 50% level. So this is a level that I really like, a lot of people like the 61.8% more. That’s like the golden ratio or the golden number. I prefer 50%. I’m just a lower risk trader. So I believe that this is going to go up here and hit that.

Let’s go ahead and take a look and see what happened with this trade. You could see, I entered the trade rate here. I won the trade rate here. This was a nice win. I made $2,831 from this trade. Really, really happy with this trade. I think it was awesome. And I think that this is a good trade for us to end off on. 

Conclusion

So don’t leave right now cause I’m going to pop up to my FX book. I’m going to show you the live trading results. I’m going to talk about this a little bit more and get you understanding how you can use this in your day to day trading to grab 30 pips a day and just win more trades with ease. So obviously if you got this far in the video, you know, my simple Forex strategy is a banger. I love the RSI. I love the Fibonacci. Even if I use it in a weird way sometimes, I hit $8,500 in just two days using this strategy. It works. I know it works. You know it works. I took four trades. I won all four of those trades and I averaged around 30 pips for every single win. This is an effective strategy, but don’t be an idiot. Use confluence. Use your own knowledge. Don’t just take every single trade every time it’s oversold or over bought. Use your own knowledge. Use your own money management and make good decisions. 

If you got this far in the video, come to my Instagram account, give me a follow, like some posts, DM me, and I’ll give 15 of you free access to my VIP group for the next week. I do this every week. You’ve got about a 5% chance to win if you DM me. So it’s worth a shot and that’s all I’ve got to say, guys, check out my VIP group, check out my new strategies.

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