Bollinger Band and RSI Reversal Strategy with Fixed Percentage Exits
Summary
This strategy enters a long position when the close falls below the lower Bollinger Band and RSI is below its oversold threshold. It enters short when price closes above the upper band while RSI is above its overbought threshold. The script calculates a position quantity from a stated dollar risk and percentage stop distance, then places a stop and a take profit at a configurable multiple of that distance. Chart lines and shaded regions show the entry, stop, and target while a position is open.
The supplied defaults use a 20 period Bollinger calculation, a 14 period RSI, thresholds of 30 and 70, and a 2 to 1 reward to risk target. These are parameters, not evidence of profitability: the document includes no backtest statistics or validation. The title's four hour profitability claim is unsupported by results here. Actual risk may differ from the configured amount because of fill prices, contract specifications, gaps, fees, and execution assumptions.
Key ideas
- Long entries require a close below the lower Bollinger Band and an oversold RSI reading.
- Short entries require a close above the upper band and an overbought RSI reading.
- Stops and targets are set as percentages from the signal close, with a configurable reward to risk multiple.
- Position quantity is calculated from the dollar risk setting and stop distance.
- The document provides no backtest evidence to substantiate its profitability claim.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.