Long-Only RSI Oversold Reversal with Fixed Stop and Profit Targets

Summary

This long-only strategy uses the Relative Strength Index to seek rebounds after oversold readings. It calculates RSI over a configurable period, with a stated default of 14, and enters when RSI crosses back above the oversold threshold, whose default is 30. On entry, it sets stop-loss and take-profit levels as percentages of the closing price. The described defaults are 2% for the stop and 5% for the target, and the strategy avoids additional entries while a position is open.

The document gives parameter settings and a published backtest configuration for BTC/USDT futures on Binance over May 2024, using a one-hour chart period and a 15-minute base period, but reports no performance statistics. The prose and code differ slightly: the overview says a buy signal occurs below the threshold, while the code enters on an upward RSI crossover of that level. Exits are checked against closing prices, so the description does not establish intrabar execution behavior. The notes flag false signals in sustained declines and sensitivity to RSI and exit parameters.

Key ideas

• The strategy enters long when RSI crosses above a configurable oversold threshold.
• Stop and profit target levels are set as percentages of the entry bar’s closing price.
• It permits only one open position and does not take short trades.
• The published setup gives a BTC/USDT futures period, but no backtest results are reported.
• The code’s crossover trigger differs from the prose description of buying when RSI is below the threshold.

Tags

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