Gold Strategy Combining Liquidity Sweeps and RSI Divergence

Summary

This gold-focused strategy combines two reversal setups: a liquidity sweep and RSI divergence. The sweep logic looks for price to move beyond a recent high or low, then close back inside that level with movement in the reversal direction. The divergence logic compares recent price extremes with RSI extremes and applies overbought or oversold thresholds. Either setup can be enabled separately, and the script also marks cases where both signal together.

Stops and targets differ by setup. Sweep trades place stops beyond the sweep excursion and set targets using a configurable reward-to-risk multiple; divergence trades use ATR-based stops and targets. The script also includes a UTC session filter, maximum holding periods, a daily trade cap, and a direction setting. The supplied material describes code and inputs but gives no backtest results or evidence that the confluence signals are more reliable. Its thresholds, lookbacks, and risk controls are configurable, and any performance depends on the instrument, timeframe, execution assumptions, and testing method.

Key ideas

• The strategy offers liquidity-sweep reversals and RSI-divergence trades as separate signal sources.
• A sweep signal requires price to cross a prior range extreme and close back through it in the reversal direction.
• Divergence signals compare price and RSI extremes, subject to threshold conditions.
• Sweep and divergence trades use different stop and target calculations.
• Session limits, holding periods, and a daily trade cap constrain trade activity.

Tags

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