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Bollinger band reversion strategyvsRSI mean reversion strategy

Bollinger band reversion strategy: Fade a 2-sigma stretch below the mean and exit when price tags the middle band. Β· RSI mean reversion strategy: Buy when the market is overextended below the mean, ride it back to fair value.

Mean reversionLong only

Bollinger band reversion strategy

Fade a 2-sigma stretch below the mean and exit when price tags the middle band.

Mean reversionLong only

RSI mean reversion strategy

Buy when the market is overextended below the mean, ride it back to fair value.

Indicators

  • Bollinger Bands (period 20, Οƒ Γ— 2)
  • RSI (period 14)

Timeframes

15m1h4h
15m1h4h

Bias

Long only

Long only

Market fit

Range-bound

Range-bound

Entry rules

  • Enter long when close is below the lower Bollinger band β€” a 2Οƒ stretch below the 20-bar mean.
  • Single position; 3-bar cooldown after exit.
  • Enter long when RSI(14) prints below 30 β€” the textbook oversold threshold.
  • Only one position at a time; the cooldown blocks immediate re-entry after an exit.

Exit rules

  • Exit when close pushes back above the middle band.
  • Hard 3% stop-loss; 2% trailing stop locks in any reversion gain.
  • Close the position when RSI(14) recovers above 70.
  • Hard stop-loss at 3% below entry; take-profit at 5%.

Expected behavior

Smooth equity curve in low-volatility regimes with frequent small wins. Sharp drawdowns when a trend extends and price stays pinned below the lower band β€” the strategy expects mean reversion that may not arrive.

Choppy zig-zag equity curve with frequent small wins and the occasional outlier loss when a sharp downtrend leaves RSI pinned in the oversold zone. Fits range-bound chop; struggles in strong directional regimes.

Complexity

1 ind Β· 2 entry Β· 2 exitBalanced
1 ind Β· 2 entry Β· 2 exitBalanced

Which one is right for you?

Derived from the bias, timeframe and indicator profile of each strategy β€” not a back-test forecast.

When to pick Bollinger band reversion strategy

  • You expect range-bound β€” the thesis is "Fade a 2-sigma stretch below the mean and exit when price tags the middle band."
  • You want a long-only bot on 15m–4h candles with a balanced rule-set.
  • You're comfortable monitoring 1 indicator (Bollinger Bands (period 20, Οƒ Γ— 2)).

Fade a 2-sigma stretch below the mean and exit when price tags the middle band.

When to pick RSI mean reversion strategy

  • You expect range-bound β€” the thesis is "Buy when the market is overextended below the mean, ride it back to fair value."
  • You want a long-only bot on 15m–4h candles with a balanced rule-set.
  • You're comfortable monitoring 1 indicator (RSI (period 14)).

Buy when the market is overextended below the mean, ride it back to fair value.

Bollinger band reversion strategy

Fade a 2-sigma stretch below the mean and exit when price tags the middle band.

Try Bollinger band reversion strategy in dashboard β†’Read full breakdown β†’

RSI mean reversion strategy

Buy when the market is overextended below the mean, ride it back to fair value.

Try RSI mean reversion strategy in dashboard β†’Read full breakdown β†’

Related comparisons

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