Long-Only RSI of MACD Reversal Strategy

Summary

This long-only approach calculates RSI on the MACD line rather than directly on price. It opens a position when that RSI crosses above either of two nearby oversold-entry levels, provided price is above a slow EMA. The strategy sizes the order as a fraction of equity relative to a percentage stop distance, capped so the order value does not exceed available equity.

A full exit occurs when RSI of MACD crosses below a lower threshold. An optional partial exit closes one third of the position after the indicator has moved into an overbought region and then crosses back below it while the trade is profitable. The document gives indicator settings and BTC/USDT futures backtest dates, but no performance evidence. It identifies parameter sensitivity and overly early profit taking as risks; the source's configurable take-profit is partial, while a separate fixed stop is not visibly implemented as an exit rule. It is therefore a described signal method, not proof of profitability.

Key ideas

• RSI is applied to the MACD line to identify potential momentum reversals.
• A long entry requires an upward cross of an oversold threshold and price above a slow EMA.
• Position size is based on equity risk and a percentage stop distance, with an equity-value cap.
• The strategy can scale out one third after an overbought reading reverses and close fully on a lower threshold cross.
• The document gives backtest settings but no results, and the source does not show a fixed-stop exit order.

Tags

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