Support and Resistance Reversals with RSI and Volume Filters
Summary
This strategy uses rolling support and resistance levels with RSI extremes to signal potential reversals. Support and resistance are defined as the lowest low and highest high over a 30-period window. The stated rules buy near support when 14-period RSI is below 30, and sell or enter short near resistance when RSI is above 70. A volume filter can require current volume to exceed its 20-period average, and a date window can restrict trading. The example parameters also include a 50-period SMA.
The document describes a BTC futures setup and a separate published example on ETH futures, but gives no outcome statistics. The source plots the SMA yet does not use it to filter entries, despite the explanatory text presenting it as a trend indicator. It also lacks explicit stop-loss, profit-taking, and position-sizing rules, and the rolling extrema may not act as reliable reversal levels. The text identifies false breaks, frequent signals, and parameter sensitivity as concerns and suggests testing added risk controls and filters.
Key ideas
- Rolling lows and highs define support and resistance over a configurable window.
- Potential longs require price near support and RSI below 30; potential shorts require price near resistance and RSI above 70.
- An optional filter requires volume to exceed its 20-period average.
- The source calculates and plots a 50-period SMA but does not use it in entry conditions.
- No stop-loss, profit target, or performance statistics are provided.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.