PlanB Quant Investing 101 v2
Aug 11, 2022
The PlanB Quant Investing 101 indicator is a momentum-based strategy tool designed to identify market entry and exit points by tracking Relative Strength Index (RSI) extremes and subsequent reversals.
Usage
The strategy is designed to capture cyclical market movements by identifying periods of exhaustion and recovery. Users can monitor the signals generated on the chart to determine potential trend shifts based on historical RSI thresholds.
- Buy Signal: Occurs when the RSI has been below a specific threshold (default 50) within the last six months and then experiences a specified bounce (default +2%) from its recent low.
- Sell Signal: Occurs when the RSI has been above a specific threshold (default 90) within the last six months and then drops below a secondary level (default 65).
Details
This tool is an implementation of the quantitative strategy outlined in the "Quant Investing 101" article by PlanB. The logic focuses on the premise that significant price peaks are often preceded by extremely high RSI levels, while bottoms are formed after periods of RSI weakness followed by a confirmed momentum recovery. By looking at a six-month lookback window for RSI extremes, the script filters for significant cyclical shifts rather than minor intraday fluctuations.
Settings
- Sell Level RSI: The threshold the RSI must exceed within the lookback period to prime a sell signal (Default: 90).
- Drop Level: The RSI level the current value must drop below to trigger a sell signal after the Sell Level has been breached (Default: 65).
- Buy Level RSI: The threshold the RSI must fall below within the lookback period to prime a buy signal (Default: 50).
- Bounce Amount: The percentage amount the RSI must rise from its recent low to trigger a buy signal (Default: 2).
FAQ
How do I use the PlanB Quant Investing 101 signals?
The signals are intended for long-term cyclical analysis. A "Buy Signal" suggests a recovery from a low-momentum state, while a "Sell Signal" suggests a reversal from an overextended high-momentum state.
What timeframe is best for this indicator?
As the strategy is based on "Quant Investing 101" principles often applied to monthly or weekly data, it is typically most effective on higher timeframes to capture macro cycles.
How can I access PlanB Quant Investing 101?
You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.
Trading & investing are risky and many will lose money in connection with trading and investing activities. All content on this site is not intended to, and should not be, construed as financial advice. Decisions to buy, sell, hold or trade in securities, commodities and other investments involve risk and are best made based on the advice of qualified financial professionals. Past performance does not guarantee future results.
Hypothetical or Simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, including, but not limited to, lack of liquidity. Simulated trading programs in general are designed with the benefit of hindsight, and are based on historical information. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown.
Testimonials appearing on this website may not be representative of other clients or customers and is not a guarantee of future performance or success.
As a provider of technical analysis tools and strategies, we do not have access to the personal trading accounts or brokerage statements of our customers. As a result, we have no reason to believe our customers perform better or worse than traders as a whole based on any content, tool, or platform feature we provide.
Charts used on this site are by TradingView in which the majority of our technical indicators are built on. TradingView® is a registered trademark of TradingView, Inc. www.TradingView.com TradingView® has no affiliation with the owner, developer, or provider of the Services described herein.
Market data is provided by CBOE, CME Group, BarChart, Massive, CoinAPI. Select U.S. equities data is provided through Massive. CBOE BZX real-time U.S. equities data is licensed from CBOE and provided through BarChart. Real-time futures data is licensed from CME Group and provided through BarChart. Select cryptocurrency data, including major coins, is provided through CoinAPI. All data is provided “as is” and should be verified independently for trading purposes.
This does not represent our full Disclaimer. Please read our full disclaimer.
© 2026 LuxAlgo Global, LLC.