 In this video, we are going to cover the very important topic of when to exit your trade. Let's assume you followed all the rules so far. So you've used the scanners properly, you've identified which stocks to trade, you've used the MTFT and you've taken a trade and it's going in your direction. Now, when do you exit? This is where the custom RSI indicator comes in. You can stay in a winning trade longer. Very often what we all do it's human nature is we tend to cut our winners short and hold on to our losers. This is general human tendency. There's nothing to be ashamed of. This is how we all behave. However, when you have visual indicators that tell you when to get in, when to get out, it makes the decision a no-brainer decision. And so let's take a look at custom RSI. I'll give you a brief explanation here. The normal RSI tells you overbought and oversold conditions. However, this particular RSI has been customized and it is customized to show persistence. So which means you want to stay in a winning trade as long as possible. The custom RSI works perfectly with both the MTFT as well as the SPX sticks. Now, we haven't looked at the SPX sticks. We'll do that in the next video, but it works very well. It confirms a great trade entry point. It confirms a great trade exit point. So now let's go into the platform and look at custom RSI and how it works for all three of our environments, which is day trading, the short-term swing trading, and then the long-term investing plan. Let's look at these three examples and see how custom RSI would have told you when to come out of the trade. First, we are going to look at the SPX example from yesterday. We saw this example earlier. We saw that in the first half of the day, we had a nice bullish trade going. And then in the second half of the day, we had a much, much better bearish trade going. The indicator custom RSI is right below the MTFT. So let's zoom in on the first half of the day first, which is all of this part right here. And let's see what custom RSI would have shown us. So assuming you would have gotten into this trade somewhere here at this level, you can see that the custom RSI is in the bullish zone. The normal RSI would have told you that this is an overbought condition. However, this indicator has been customized. Now it's been customized to show persistence. So once the custom RSI goes into the bullish zone and it's moving higher, it's telling you to stay in the trade. It's telling you to stay in the trade. If you had to come out here, you could have, you can see that there is one red dot, but that's not enough. So between the MTFT and the custom RSI, you have to make a decision there. You're only seeing one red dot on the MTFT. It's not time to come out. And the custom RSI falls into the neutral zone. It's not bearish. It's fallen into the neutral zone. But very soon, within three or four minutes, it goes back into the bullish zone and you're still all the way in this trade. Perhaps this is where it briefly enters the bearish zone and that's good enough. You can take the trade off. If you got into the trade here, 45-15 and you would have been in this trade till about 45-25 or somewhere here, which would be about 10 points on the SPX. And once again, if you want to take these smaller trades, you can. This is also a trade for about 10-15 minutes or so. This one goes on for about, I would say, 20 minutes or so. So if you got in on this bar right here, you would still be in this trade all the way till this point when it enters the bearish zone. So the custom RSI is customized to tell you that you are in a bullish zone or a bearish zone and you want to stay there until the custom RSI changes. So once again, you see there's a nice little bull run over here where you have only one red dot. So that would be somewhere from here onwards, you would go and you would stay in this trade all the way till about here. You're almost picking the top. Exactly. You're not picking it exactly because you would have come out when the custom RSI went into the bearish zone, which is over here. So you got it all the way till about 5 minutes after the trend changed, you would have been out of this trade. Now let's take a look at the second half of the day and here is where also it is an extremely helpful indicator because if you got into the trade somewhere here when you see all 5 are aligned and from there you can see the custom RSI briefly goes out over there and even if you exit it, that's fine. You can always get back in and once you saw this again, the trend is starting to develop and it's going deeper and deeper and that's telling you that you want to stay in this trade. The MTFT is telling you there's only one dot that is not aligned. That's fine and you want to go all the way till about here. Here the custom RSI goes into the bullish so maybe that's the time you exit. So once again we saw this. This was about a 50 point move on the SPX and custom RSI allows you to stay in this position for as long as possible. So this is how it would work in a day trading environment. Now let's take a look at the other environments as well. Here we are looking at our short-term swing trading so which was a trade of about 2 weeks, 3 weeks something like that. So you can see that last year around September we entered a bearish mode and of course there were some bull runs over here but if you were let's say you were in this trade for about a week or 2 weeks, you can see the custom RSI also is persistent over there. So let me move it back and you can zoom in and check this out. So here this trade would have lasted you about 8 to 9 days. This trade would have lasted I would say about 13 to 14 days because it doesn't include weekends. So once again your custom RSI is showing persistence and until you see this change there is no need to come out of the trade. So there's two ways you can look at it. If the MTFT shows a clear change in trend which is two or more rows going the other way you want to exit the trade or if the custom RSI goes from bearish to bullish you want to exit the trade. So between the two they work together very very well and you can see that whenever you see the MTFT and the custom RSI is aligned that's obviously even more higher probability for your trade. So let's continue over here you can see that little choppiness all over this place. So most importantly these indicators also tell you when not to take a trade because if you're seeing a bunch of reds and greens you don't want to take a trade. You want to see either all greens you want to see all reds whatever the case might be but you want to see a trend and that's what these indicators help you to do. So once again here there's a little bit of choppiness and you can see the price action. It's all quite choppy over here. Here you have a little bit of a run that's that's about it and then you have another bear run here and if you look at this is a nice little run on the SPX right starting from here you could have gone till about here when you see two or more dots and of course sure enough custom RSI also dips into the bearish right after that. So and then there's a little bit of choppiness here you can see two or more rows that are not aligned so you don't want to take the trade. Now this is a nice trade right here. Custom RSI also enters into the bullish zone and you see a green over here maybe and or over here whichever the case might be but this would have taken you from an SPX level of 42.11 all the way till about I would say till this one which is about 44. So that's the that's the one we saw earlier also. This is a 200 point move on the SMP. So this is how you would use the custom RSI for a swing trading environment. Now let's quickly look at the long term as well which is going to be quite similar except the time frames are longer so you have more conviction in your trade you cannot you don't want to be thrown out of your trade quickly. So let's go back to the SPX and you can see some nice trends here you know from here onwards up until here when you see two dots you come out and then there was another nice run from here which is a level of about 4178 all the way till 4200 we saw that earlier. Let's take a look at another stock let's take another look at Tesla. So Tesla off late has been sort of bearish or rather there's no signal there so you don't want to get into Tesla at this point you know it needs to show a clear trend but before this you saw that Tesla was very bullish from here all the way and if you saw the two dots over here but the custom RSI really doesn't tell you that you should be getting out of the trade so even though you see two dots if you want to be safe you come out of the trade no worries but if you were hanging there you would have gotten a little bit more reward. Let's take a look at another stock right here Apple. Apple has been bullish except for the last couple of weeks or so it's been bearish but otherwise you had some fantastic runs on Apple also all the way going back to last year really I mean you had some fantastic runs look at this one from about here which is 151 it goes all the way and the custom RSI is in the bullish zone all the way till about here and if you wanted to get out of the trade here when the custom RSI dips that's fine but on the MTFT it is still only one dot so you could have remained in this trade till about till about here when you see two dots that's the time to come out there's no point in taking the risk on the trade the indicators have given you the best possible information which is when to get in and when to get out and if you're capturing 80% of the move 85% of the move that's a fantastic trade sometimes these indicators might change very quickly depending on the price action but the good thing is the indicators will tell you that that the trend is changing so you might have gotten into a trade and two days later things have changed so that's okay you're going to have a couple of losing trades but when you can maximize the number of winning trades and then on those winning trades if you can maximize the profit that's what it's all about it's a numbers game and these indicators help you stay in a winning trade as long as possible so you've seen all of these indicators you've seen how to identify the trading candidates how to get the proper trade entry and then now you're seeing how to get the exit as well there's another indicator which is very specific to the SPX it's called the SPX sticks we'll take a look at that indicator also in the next video but that only applies for day trading the SPY or the SPX options it's a day trading indicator but it gives you some very powerful information about what's going on in the market on that particular day so we'll be taking a look at that as well thanks