ADX, RSI, and Bollinger Width for Range-Regime Entries

Summary

This script labels conditions as range-bound when ADX is below 25, RSI is between 35 and 65, and Bollinger Band width is below 8%. When all three conditions hold and there is no open position, it enters a long position. It closes that position after 21 bars or if the price falls more than 5% below the recorded entry basis. The chart also displays the bands, regime shading, and a dashboard with indicator readings, including a historical-volatility proxy.

The document provides strategy code and lists example equities, but it gives no performance results or backtest evidence. Despite the description’s reference to credit spreads and premium collection, the code trades a long position in the underlying; it does not implement options or a spread. The volatility proxy is displayed but does not affect the entry or exit rules. The listed thresholds are fixed defaults, and the document does not establish their suitability across assets or timeframes.

Key ideas

• The range filter requires low ADX, middle-range RSI, and narrow Bollinger Bands at the same time.
• A qualifying regime triggers a long entry when the strategy is flat.
• The position exits after the specified holding period or a 5% adverse move from its recorded basis.
• Historical volatility is shown in the dashboard but is not used to determine trades.
• The code trades the underlying long and does not implement the credit-spread strategy suggested by its description.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.