RSI and ATR Rules for Staged Cost-Averaging Swing Trades

Summary

This strategy combines RSI-based oversold entries with ATR-based position sizing and profit targets. On a four-hour or daily chart, it opens up to four staged long entries when RSI falls below 30. Each entry is sized using a stated $200 total risk amount and twice the ATR; the running average entry price is updated as positions are added. The exit threshold is set three ATR above that average price, adapting the target to current volatility.

The document explains the intended benefits of spreading entries and adjusting exits to volatility, and flags risks from persistent declines, excessive capital use, and targets set too far away. It recommends limiting the number of entries, considering a stop loss, and improving entry filters and drawdown controls. Published backtest settings identify DOGE/USDT on Binance over a one-year daily interval, but no performance results are provided. The source logic also does not show a stop-loss rule, so the described safeguards should not be assumed to be implemented in the strategy.

Key ideas

• RSI below 30 triggers staged long entries, subject to a four-entry cap.
• Position size is calculated from a stated $200 risk amount and twice the ATR.
• The strategy tracks average entry price as additional positions are opened.
• A take-profit threshold is set three ATR above the average entry price.
• Persistent declines and capital use remain risks, and published settings do not include performance results.

Tags

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