RSI Reversal Entries Confirmed by Volume and Prior-Bar Breaks

Summary

This script describes a reversal approach that looks for unusually stretched RSI readings alongside elevated volume. A long setup requires RSI below its lower threshold and volume above a multiple of its moving average, followed by a close above the previous bar’s high. The short setup mirrors this logic, using an upper RSI threshold, high volume, and a close below the previous bar’s low. Entries use a percentage-of-equity sizing setting, and the setup bar’s low or high becomes the respective stop reference.

Open positions are closed when price reaches VWAP as a target or crosses the stored stop reference. The document supplies rules and indicator settings, but no backtest results, instrument, or timeframe. It does not explain parameter selection or execution assumptions, and the VWAP is calculated without being used as an entry filter. Performance claims in the surrounding page are unsupported by reported evidence, so the script alone does not establish that the method works reliably.

Key ideas

• The long and short setups combine extreme RSI readings with volume above its moving average.
• A close beyond the preceding bar’s high or low confirms the respective reversal entry.
• The setup bar’s low or high provides the stop reference, while VWAP serves as the profit exit.
• The page gives no backtest results or market-specific evidence for the strategy.

Tags

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