RSI Mean Reversion

RSI Mean Reversion Strategy - Volatility Optimized
This strategy combines RSI mean reversion signals with intelligent market filtering and volatility-adapted risk management to maximize performance across different market conditions.

What it does: Identifies high-probability reversal opportunities when RSI reaches extreme levels (≤30 oversold, ≥70 overbought), but only trades when market conditions favor mean reversion strategies.

How it works:
RSI Signals: 14-period RSI identifies oversold/overbought extremes

• Smart Filtering: Avoids strong trending markets (>25% trend strength) where mean reversion fails
  
• Volatility Adapted: 20% stop loss accommodates natural price fluctuations in volatile assets
  
• Position Scaling: 5% equity per trade with pyramiding capability for strong setups
  
• Trend Awareness: Uses 50-period MA to determine market direction
  

Key Features:

• Volatility Optimized: 20% stop loss prevents premature exits in normal market noise
  
• Risk Management: 1:1 risk/reward ratio (20% stop loss, 20% profit target)
  
• Market Intelligence: Real-time suitability analysis prevents trading in unfavorable conditions
  
• Automation Ready: Built-in alert conditions for automated execution
  

Visual Indicators:

• Green background = Oversold in suitable market (BUY zone)
  
• Red background = Overbought in suitable market (SELL zone)
  
• Orange warnings = Strong trend detected - avoid trading
  
• Info table shows real-time market conditions and trade status
  

Performance Optimizations:

• Position size: 5% of equity for meaningful impact
  
• Pyramiding: Up to 2 positions for scaling into winners
  
• Designed for volatile assets that need breathing room
  

Best Used On:
Assets with 1%+ daily volatility in ranging or weak trending markets. Automatically filters out unsuitable conditions to protect capital.
This strategy addresses the main failure points of basic RSI systems by adding market context and volatility-appropriate risk management.