Pivot Point Reversal + RSI Strategy

The Pivot Point Reversal + RSI Strategy indicator combines price action pivot points with momentum filtering to identify high-probability trend reversal entries using stop orders.

Usage

The Usage section focuses on identifying structural pivot highs and lows to set entry levels. A long entry is triggered when a pivot high is established and the RSI at that time is below the overbought threshold, suggesting room for further upside. Conversely, a short entry is prepared when a pivot low is confirmed while the RSI is above the oversold threshold.

Example applications:

• Trend Reversals: Identify potential shifts in market structure on intraday timeframes like 30m or 1h.
• Breakout Confirmation: Use the RSI filter to avoid entering exhausted moves that are already deep into overbought or oversold territory.

Details

The script utilizes the ta.pivothigh() and ta.pivotlow() functions, which require a specific number of bars to the left and right to confirm a peak or valley. Because of the rightBars lookback required for confirmation, the strategy references the RSI value at the time the pivot occurred, ensuring the momentum context matches the price structure. Entries are executed via stop orders placed at the pivot price levels plus or minus one tick.

Settings

Pivot Points

• PP - Left Bars: The number of bars to the left required to detect a pivot.
• PP - Right Bars: The number of bars to the right required to confirm a pivot (introduces lag for confirmation).

RSI

• RSI - Length: The period used for the Relative Strength Index calculation.
• RSI - Overbought level: The maximum RSI threshold allowed for long entries.
• RSI - Oversold level: The minimum RSI threshold allowed for short entries.

FAQ

How do I use the Pivot Point Reversal + RSI Strategy?

The strategy automatically plots entry levels based on confirmed pivots. When the RSI conditions are met, stop orders are placed at the high/low of the pivot.

What timeframes are best for this strategy?

While it can be used on any timeframe, it is particularly effective on the 30m, 1h, and 2h charts for volatile assets like cryptocurrencies.

How can I access this tool?

You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.