Combining the Alligator Indicator, Momentum Indicator, and Relative Strength Index (RSI) creates a powerful trading strategy that balances trend-following, speed of price movement, and overbought/oversold conditions.
Open Account: http://pocketoptioncapital.com
The Alligator Indicator, created by Bill Williams, uses three smoothed moving averages (lips, teeth, and jaw) to determine trend direction and identify periods of market sleep (consolidation) versus awakening (trend breakout). When the lines are intertwined, the market is consolidating; when they spread apart and align directionally, it signals a trending phase, offering ideal conditions for momentum-based entries.
The Momentum Indicator adds precision by measuring the rate of price change over a specified period. It acts as a trigger: if the Alligator shows a newly awakened trend, a strong reading from the Momentum Indicator confirms price acceleration in that direction. For instance, in a bullish setup where the Alligator’s lips are above the teeth and jaw, a rising momentum line above the zero level adds conviction to a long trade. Traders can also spot early trend reversals when momentum begins to diverge from price before the Alligator lines start to cross.
Meanwhile, the RSI serves as a filter to avoid overextended entries. It oscillates between 0 and 100, identifying overbought conditions above 70 and oversold conditions below 30. In this combined strategy, the RSI can be used to confirm the sustainability of a trend or warn of potential exhaustion. For example, in a bullish move, if RSI is between 50–70, it reinforces trend strength; if it crosses into overbought territory while momentum slows, it may signal a pullback. Using all three indicators in tandem provides a layered approach to entries and exits, significantly reducing false signals and increasing the probability of success.
Open Account: http://pocketoptioncapital.com
Risk Disclaimer:
Trading options involves financial risk and may not be appropriate for all investors. The information presented here is for information and educational purposes only and should not be considered an offer or solicitation to buy or sell any financial instrument. Any trading decisions that you make are solely your responsibility. Past performance is not necessarily indicative of future results.
Open Account: http://pocketoptioncapital.com
The Alligator Indicator, created by Bill Williams, uses three smoothed moving averages (lips, teeth, and jaw) to determine trend direction and identify periods of market sleep (consolidation) versus awakening (trend breakout). When the lines are intertwined, the market is consolidating; when they spread apart and align directionally, it signals a trending phase, offering ideal conditions for momentum-based entries.
The Momentum Indicator adds precision by measuring the rate of price change over a specified period. It acts as a trigger: if the Alligator shows a newly awakened trend, a strong reading from the Momentum Indicator confirms price acceleration in that direction. For instance, in a bullish setup where the Alligator’s lips are above the teeth and jaw, a rising momentum line above the zero level adds conviction to a long trade. Traders can also spot early trend reversals when momentum begins to diverge from price before the Alligator lines start to cross.
Meanwhile, the RSI serves as a filter to avoid overextended entries. It oscillates between 0 and 100, identifying overbought conditions above 70 and oversold conditions below 30. In this combined strategy, the RSI can be used to confirm the sustainability of a trend or warn of potential exhaustion. For example, in a bullish move, if RSI is between 50–70, it reinforces trend strength; if it crosses into overbought territory while momentum slows, it may signal a pullback. Using all three indicators in tandem provides a layered approach to entries and exits, significantly reducing false signals and increasing the probability of success.
Open Account: http://pocketoptioncapital.com
Risk Disclaimer:
Trading options involves financial risk and may not be appropriate for all investors. The information presented here is for information and educational purposes only and should not be considered an offer or solicitation to buy or sell any financial instrument. Any trading decisions that you make are solely your responsibility. Past performance is not necessarily indicative of future results.
Category
📚
LearningTranscript
00:00For over a week now, I've been trying out this strategy and it has been giving me a very good
00:04winning rate. I've been taking 10 trade every day using this particular strategy and I always have
00:10a winning rate of about 70, 80 and 90 percent. That is to say out of my 10 trade, I often have
00:177, 8 and 9 winning rate using this strategy which is actually a very good one. That is the reason
00:23why I have to come right here to share it with you so you all can also try it out to make a very
00:28good amount of money in the market. I want you guys to know that every strategy I often shared
00:32on this channel, those are the strategies I personally tried out and it has been working
00:37pretty much well for me. So do ensure you try out this strategy on your demo account for a couple
00:42of days. Practice it well to have confidence on the strategy before you can apply it on the real
00:47market. This strategy is a very simple one, very accurate and also very powerful based on my
00:52experience. And so far, I was able to move my account from $8,000 to $7,000 using this strategy.
00:59This strategy comes with just three indicators. We're going to be making use of Alligator Indicator,
01:04the RSI and the Momentum Indicator. Those are the three indicators we're going to be using
01:09with this strategy. So for those of you that are yet to know where to get your indicators,
01:13you're going to come over to this section. This is where you're going to see your indicators.
01:17So the first indicators, as I've said, is the Alligator Indicator. We're going to be using RSI
01:22Indicator and also going to be using the Momentum Indicator. So the settings of our Alligator
01:28Indicator comes with the jazz period of 15, the jazz shift as 7, the tooth period as 10,
01:35the tooth shift as 6, the lips period we're going to be making it as 5, while the lips shift we're going
01:40to be using 4. Right here on the style level, on the lips period, we're going to be using a green color.
01:46I'm going to be using it on 1 pixels, while on the tooth period, we're going to be using a red color.
01:52I'm going to be using it on 1 pixels as well. The jazz period, we're going to be using it as blue.
01:56I'm going to be using it as 1 pixels. When you're done with all these, then you can hit save.
02:01With our RSI, it comes with the period of 13. Right here on the style level, we're going to be leaving
02:07this color just like this. I'm going to be using it on 1 pixels. When you're done, just click on save.
02:12Right here with our momentum, it comes with the settings of a period of 10. Right here on the
02:17style level, we're going to be using the up section, which is going to be a green color.
02:22The down section is going to be a red color. Then when you're done, just click on save. So with this
02:28strategy, I'm actually trading it with 15 seconds candle timeframe. I'm going to be using the normal
02:33Japanese candle stick. Not only that guys, I'm going to be trading this strategy on 1 minute.
02:38So guys, I want you to know that trading involves a lot of risk. So you must be able to trade using
02:44a very good risk to reward management. Because in my previous videos, I always made mention of that.
02:49Anytime you're trading, do ensure you're trading with the amount of money you can lose in the market.
02:54And do ensure you don't risk more than 1 to 5%, at most 10% of your capital on each trade you're
03:01taking. I hope you're getting that right. So right here, I have $7,000 in my trading account,
03:05and I'm going to be entering each trade with $500. That is below 10% of my trading account. So do
03:10ensure you trade using a proper risk management guys. So guys, for you to better understand this
03:15strategy, I'll have to go into the market right away. When I find an opportunity, I'm going to
03:19come right here and explain to you what you need to see before you enter a trade. So guys, right here,
03:25we're looking out for a very good opportunity in the market. So you can see we're having a very good
03:31confirmation right here. So we want our alligator lines to all intersect each other before we can
03:36be able to take a trade. Hope you're getting it right. So let's wait for the next candle. So right
03:42here guys, we can take a trade right at this particular level for a buy trade. Now this is
03:47what you need to be looking out for anytime you are trading using this strategy. The first thing you
03:52need to see is the consistency of a candlestick. I always made mention of this in my videos. Anytime you
03:57want to trade, when you find the consistency of a candlestick, that is to show that the market
04:02is pretty much ready to go towards the direction. If it is in an upward direction, it's ready to go
04:08in an upward direction. And if it is in a downward direction, it's ready to go on a downward direction.
04:13The next thing you also need to put into consideration is your alligator indicator lines. The
04:18lines has to intersect each other. The all lines has to intersect each other. Not only does your RSI
04:24indicator has to be moving from the oversold condition towards the upside direction. Once
04:29you also see that as well, your momentum should also be another way of consideration. Your momentum
04:34has to be printing out a green colors right at this particular point, giving you another good
04:40confirmation to enter a buy trade. I hope you're getting it right. As you can see right here guys,
04:45we smash in a very good profit right at this particular level. So this is what you need to put
04:50into consideration if you're going for a buy trade. So guys, let's find another opportunity in the case
04:56of a sell trade. So guys, right here, we're looking out for a selling opportunity right at this particular
05:02point. As you can see, we have a consistency of a candlestick building up right here. So what we're
05:10looking at right here is our alligator line. This is the major indicator we have to be looking out for.
05:15The two line has to properly crosses each other. Immediately, we see that then we have to take a
05:20trade. As you can see right here, everything is pretty much building up. Our RSI indicator is moving
05:26from the overbought condition heading towards the downside direction. As you can see right here,
05:32let's actually enter for a sell trade right at this particular level guys. So you can see right here,
05:38candlestick are pretty much stable. The alligator lines all intersect each other. Not only that our RSI line
05:44is going from the overbought condition towards the oversold condition. And as you can see, our momentum
05:49is building up giving us a red candle showing that the market is pretty much ready to go on a downside
05:54direction. Hope you're getting it right. If you follow all this instruction, definitely guys,
05:58you're going to be making a very good amount of money. I really want to let you guys know that if you
06:02want to take a trade, your momentum and also your alligator lines are pretty much important. You need to
06:07put that into consideration. In the case of a sell trade, your momentum should be printing out. That is to say,
06:13should be moving from a green candle into a red candle. Situation whereby the momentum has actually
06:18built up in a very much larger form. Before your confirmations have been met, please do not take
06:23a trade. You are only taking a trade. Immediately, your alligator line intersects each other and your
06:28momentum candles are just building up, confirming the trend before you can be able to take a trade.
06:32I hope you're getting it right. So guys, I'm going to go into the market again for another trade.
06:37When I find another opportunity guys, I'm going to come right here and explain to you what you need to see
06:41before you enter a trade. So guys, right here, we should be looking out for a buy trade right at
06:47this particular level. So let's actually wait for the next candlestick to print out before we
06:53trigger our buy trade. So it has to be a bullish candle. So right here guys, let's enter for a buy
07:00trade right at this particular level guys. So I've said the other time before you can be able to take a
07:06trade, your candlestick has to be pretty much stable. And not only that guys, your alligator
07:11lines has to all intersect each other. Your RSI also has to be moving from the over suit condition
07:16towards the overbought condition. And do not forget, your momentum indicator has to be building up,
07:21giving you a very good confirmation before you can take a trade. So guys, this is a very powerful
07:25strategy guys. I've been trying out the strategies I've said for over a week now and it has been giving
07:30me a consistent winning rate. As you can see right here guys, we make a very good amount of money
07:36right at this particular level. So guys, I want you to try it on your demo account. When you have
07:40enough confidence with this strategy, then you can really go into the real account. So guys, this is
07:44what I'm going to stop on this video. If you like this video, do ensure you give us a thumbs up,
07:48subscribe to this channel if you are here to subscribe and do ensure you share these videos
07:52to your loved ones so they can also enjoy what you're enjoying from this channel. Till I see you
07:56again in another video guys. Keep trading guys. And bye for now.