RSI Divergence, Smart Money Concepts, Change of Character Strategy

Learn a reversal trading strategy combining Smart Money Concepts (SMC) with RSI divergence and Change of Character for trend shifts. Ideal for various timeframe

Published · Updated · Methodology: Mixed

  • Methodology: Mixed
  • Content type: strategy
  • Timeframes: Higher Timeframe, Lower Timeframe, 1 hour (example)
  • Markets: Pound Yen (example)

Indicators used

  • Relative Strength Index (RSI)

Source video

Decoded from: Best Reversal Trading Strategy SMC, Divergence by Smart Risk — watch the original

Key timestamps:

  • 0:30 - Strategy overview: SMC + RSI Divergence for market structure shifts
  • 1:15 - RSI indicator basics and traditional use (overbought/oversold)
  • 2:00 - Problem with traditional RSI use
  • 2:15 - RSI Divergence definition and examples
  • 3:45 - Pro tips for effective RSI divergence (overbought/oversold, trending markets, long-term trends)
  • 4:50 - Issue with RSI divergence alone (false signals)
  • 5:10 - Combining RSI divergence with Change of Character (ChoCh)
  • 5:40 - Change of Character definition (bullish scenario)
  • 6:20 - Combining divergence with Supply and Demand areas (higher timeframe bias)
  • 7:00 - Lower timeframe entry with RSI divergence and ChoCh (bullish example)
  • 7:40 - Bearish scenario with FVG and lower timeframe confirmation
  • 8:20 - Combining divergence with Premium and Discount zones
  • 9:30 - Combining divergence with Liquidity Sweep pattern
  • 10:00 - Liquidity sweep definition (bullish scenario)
  • 10:40 - Real chart example: Liquidity sweep + RSI divergence (Pound Yen 1 hour chart)

Topics

rsi divergence strategy · smart money concepts · change of character · reversal trading strategy · price action strategy · tradingview strategy · swing trading strategy · scalping strategy · forex strategy · pine script strategy · mixed trading strategy · market structure shift · higher timeframe analysis · lower timeframe confirmation

About this strategy page

This trading strategy was decoded by Strategy Decoder's AI from a public YouTube trading video and turned into a structured, reviewable specification. In the interactive app this page shows the full entry and exit logic, risk management settings, the indicators involved with their parameters, AlgoWizard-compatible logic and a Pine Script export ready for TradingView backtesting — plus an automated backtest verdict when one has been computed for this strategy.

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