Vortex Pivot Strategy (VPS)

Strategy Overview:

This custom indicator is designed around a powerful contrarian trading philosophy: capitalize on market-wide pessimism among both short-term and mid-term traders, and enter positions at historically high-probability bounce zones using pivot levels.

The setup combines three core ideas:

A clear downtrend structure, where short- and mid-term participants are in loss.

Entry at S3 pivot support, which statistically represents extreme oversold zones.

A quick, rational exit at the central pivot level, minimizing holding time and maximizing reward-to-risk efficiency.

📈 Conditions for Entry (Buy Setup):

50-day SMA above 20-day SMA, which is above the current price.
This sequence implies that mid-term traders (50-day SMA) are in loss, short-term traders (20-day SMA) are in loss, and price has dropped below both — indicating peak pessimism and fear.

Price must touch or dip below the S3 pivot level (from the Pivot Points Standard - Weekly).
S3 is considered an extreme support zone. When price touches it while the SMA structure confirms maximum bearish sentiment, it sets up a high-probability bounce scenario.

🎯 Exit Strategy (Target):

The central Pivot Point (P) becomes your exit level.

Since the price is entering from a deeply oversold region, a reversion to the weekly pivot is statistically probable.

This ensures the trade remains quick, directional, and avoids greed-based exits.

💡 Why This Works (Psychology & Edge):

This is a player-versus-player game. When you buy during a setup like this, you're essentially buying when the majority of active traders are in pain:

Mid-term traders (50 SMA) are holding positions at higher levels — they’re sitting in drawdown.

Short-term traders (20 SMA) are also underwater.

Panic is widespread. Volume dries up. Selling is largely exhausted.

Meanwhile, you're entering a fundamentally strong stock at a deeply discounted price, and aiming for a modest reversion — not an unrealistic uptrend continuation. That gives you both psychological and statistical edge.

You're not trying to predict a reversal — you're positioning against fear and riding the natural bounce that follows.

🔧 How to Use This Indicator:

Add this indicator to a Daily timeframe chart of fundamentally strong stocks (you should do your own fundamental screening).

Wait for the condition:
SMA stack = 50 > 20 > Price AND price touches S3.

The script will automatically draw a horizontal line at the entry (S3) and the target (Pivot).

Once triggered, take the trade and exit around the Pivot level.

Optional: you can use manual averaging or position sizing based on your risk strategy since fundamentally strong stocks typically revert over time.