Reinforced RSI - The Quant Science

This strategy was designed and written with the goal of showing and motivating the community how to integrate our 'Probabilities' module with their own script.

We have recreated one of the simplest strategies used by many traders. The strategy only trades long and uses the overbought and oversold levels on the RSI indicator.

We added stop losses and take profits to offer more dynamism to the strategy. Then the 'Probabilities' module was integrated to create a probabilistic reinforcement on each trade.
Specifically, each trade is executed, only if the past probabilities of making a profitable trade is greater than or equal to 51%. This greatly increased the performance of the strategy by avoiding possible bad trades.

The backtesting was calculated on the TSLA , on 15 minutes timeframe.

The strategy works on Tesla using the following parameters:

1. Lenght: 13
2. Oversold: 40
3. Overbought: 70
4. Lookback: 50
5. Take profit: 3%
6. Stop loss: 3%

Time period: January 2021 to date.

Our Probabilities Module, used in the strategy example:
Release Notes:
User interface improvement.

Open-source script

In true TradingView spirit, the author of this script has published it open-source, so traders can understand and verify it. Cheers to the author! You may use it for free, but reuse of this code in a publication is governed by House Rules. You can favorite it to use it on a chart.


The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.

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