Bollinger Bands Mean Reversion using RSI [Krishna Peri]

How it Works

Long entries trigger when:
- RSI reaches oversold levels, and
- At least one bullish candle closes inside the lower Bollinger Band

Short entries trigger when:
- RSI reaches overbought levels, and
- At least one bearish candle closes inside the upper Bollinger Band

This approach aims to capture exhaustion moves where price pushes into extreme deviation from its mean and then snaps back toward the middle band.

Important Disclaimer

This is a mean-reversion strategy, which means it performs best in sideways, ranging, or slowly oscillating market conditions. When markets shift into strong trends, Bollinger Bands expand and volatility increases, which may cause some signals to become inaccurate or fail altogether.

For best results, combine this script with:

- Price action
- Market structure
- Higher-timeframe trend context
- Previous day/week/month highs & lows
- Untested liquidity levels or imbalance zones
- Session timing (Asia, London, NY)

Using these confluences helps filter out low-probability trades and significantly improves consistency and precision.