Mean Reversion Bundle [ActiveQuants]

The Mean Reversion Bundle indicator is a powerful and versatile toolkit designed for traders who specialize in mean reversion strategies. This comprehensive bundle integrates eight key technical indicators renowned for their ability to identify potential price reversals, overbought/oversold conditions, and market exhaustion points. By consolidating Moving Averages (Fast & Slow), Bollinger Bands, RSI (with Divergence), Stochastic, Keltner Channels, Standard Pivot Points, ATR, and the Choppiness Index into a single, efficient script, it significantly streamlines chart analysis and empowers robust strategy development.

This bundle operates on the core principle of mean reversion: prices tend to revert to their historical average or mean over time. The included indicators provide multiple perspectives to assess these potential turning points:

• Dynamic Support/Resistance: Moving Averages, Bollinger Bands, Keltner Channels, Pivot Points.
  
• Momentum Oscillators: RSI, Stochastic.
  
• Overbought/Oversold Conditions: RSI, Stochastic, Bollinger Bands.
  
• Volatility Assessment: ATR, Bollinger Bands, Keltner Channels.
  
• Market Condition Filter: Choppiness Index (Range vs. Trend).
  
• Reversal Signals: RSI Divergence, Bollinger Band recovery.
  

By enabling users to selectively activate, extensively customize, and visualize these tools (often with multi-timeframe capabilities), the Mean Reversion Bundle facilitates a nuanced and layered approach to identifying high-probability mean reversion setups.


█ KEY FEATURES

• All-in-One Mean Reversion Suite: Access eight distinct mean reversion indicators within a single TradingView script slot, saving valuable indicator space.
  
  
• Modular Design: Easily toggle each indicator (Fast MA, Slow MA, Bollinger Bands, RSI, Stochastic, Keltner Channels, Pivot Points, ATR, Choppiness Index) On or Off through the intuitive settings menu to tailor your analysis.
  
  
• Deep Customization: Fine-tune a wide array of parameters for every indicator, including lengths, sources, MA types, colors, line styles, levels, and specific calculation methods to precisely match your trading strategy and the asset's characteristics.
  
  
• Multi-Timeframe (MTF) Capability: Configure most indicator components to analyze data from a different timeframe than your main chart, providing crucial higher-level context for mean reversion signals (e.g., daily RSI on an hourly chart).
  
  
• Integrated Alert System: Pre-built alert conditions for critical mean reversion events such as:
  - Price Crossover/Crossunder (Fast MA)
  - Price Crossover/Crossunder (Slow MA)
  - Lower Bollinger Band Recovery
  - Upper Bollinger Band Recovery
  - Bullish RSI Divergence
  - Bearish RSI Divergence
  

  Set up these alerts directly through TradingView's alert creation dialog. (See section on "█ SETTING UP ALERTS" for more details).

• Advanced MA & RSI Smoothing: Option to apply a secondary smoothing MA or even Bollinger Bands directly to the Fast MA, Slow MA, and RSI lines for refined signal generation.
  
  
• Sophisticated Pivot Points Module: Includes multiple Pivot Point types (Traditional, Fibonacci, Woodie, Classic, DM, Camarilla) with flexible timeframes (Daily to Decennially) and dynamic drawing of historical levels.
  
  
• RSI Divergence Detection: Automatically plots potential bullish and bearish divergences between price and the RSI, a classic reversal signal.
  

█ USER INPUTS

The settings panel is organized into distinct sections for each of the 8 core indicator components:

• Fast MA & Slow MA: On/Off, MA Type, Source, Length, Color, Line Width, Smoothing Type (None, MA, or MA + BBs), Smoothing Length, BB StdDev (if smoothing with BBs), Timeframe, Wait TF Close.
  
  
• Bollinger Bands: On/Off, Length, Basis MA Type, Source, StdDev Multiplier, Offset, Colors, Timeframe, Wait TF Close.
  
  
• RSI: On/Off, Source, Length, Overbought/Middle/Oversold Levels, Color, Line Width, Smoothing Type (None, MA, or MA + BBs), Smoothing Length, BB StdDev (if smoothing with BBs), Plot Divergence, Divergence Lookback Left/Right, Timeframe, Wait TF Close.
  
  
• Stochastic: On/Off, %K Length, %K Smoothing, %D Smoothing, Overbought/Middle/Oversold Levels, Colors, Timeframe, Wait TF Close.
  
  
• Keltner Channels: On/Off, Length, Multiplier, Source, Use Exponential MA (for basis), Bands Style (ATR, TR, Range), ATR Length, Colors, Timeframe, Wait TF Close.
  
  
• Pivot Points: On/Off, Type, Pivots Timeframe (Anchor), Number of Pivots Back, Use Daily-based Values, Show Labels, Show Prices, Labels Position, Line Width, Line Style, and individual color/visibility toggles for P, S1-S5, R1-R5.
  
  
• ATR: On/Off, Length, Smoothing Type, Color, Timeframe, Wait TF Close.
  
  
• Choppiness Index: On/Off, Length, Offset, Upper/Middle/Lower Band Levels, Color, Timeframe, Wait TF Close.
  

█ SETTING UP ALERTS

The Mean Reversion Bundle comes with several pre-configured alert conditions to notify you of potential trading opportunities. To set up an alert:

1. Click the "Alert" button (clock icon) on TradingView's right-hand toolbar or top panel.
   
   
2. In the "Condition" dropdown, select "Mean Reversion Bundle [ActiveQuants]".
   
   
3. A second dropdown will appear, allowing you to choose from the specific alert conditions built into the script (e.g., "Price Crossover (Fast MA)", "Bullish RSI Divergence", "Lower Bollinger Band Recovery").
   
   
4. You can also create more complex alerts by selecting one of the indicator's plotted lines (e.g., "RSI", "Stochastic %K", "Bollinger Band Basis") in the first condition box, then choosing a comparison (e.g., "Crossing Down", "Greater Than"), and then selecting another value or plotted line from the indicator in the third box.
   
   
5. Choose your preferred "Trigger" option:
   - "Only Once": The alert triggers the first time the condition is met, even on an unclosed (intra-bar) candle. The alert then deactivates.
   
   - "Once Per Bar Close": (Recommended for most mean reversion signals) The alert triggers only after the current bar closes if the condition was true on that closed bar. This ensures signals are based on confirmed price action and allows the alert to re-trigger on subsequent bars if the condition remains true.
   
   - Other options like "Once Per Bar" or "Once Per Minute" are also available for different needs.
   
   
6. Customize the alert name, message, and notification preferences.
   
   
7. Click "Create".
   

█ STRATEGY EXAMPLES

The following examples are for illustrative purposes only to demonstrate how indicators in this bundle can be combined for mean reversion strategies. They are not financial advice. Always conduct thorough backtesting and research.

1. Bollinger Band Reversal with RSI Confirmation

• Goal: Identify potential reversals when price touches an outer Bollinger Band and RSI shows overbought/oversold conditions.
  
  
• Setup: Enable Bollinger Bands (e.g., 20,2), RSI (e.g., 14), and optionally the Choppiness Index.
  
  
• Entry (Long):
  - Price touches or briefly closes below the Lower Bollinger Band.
  - RSI is in the oversold region (e.g., below 30) or shows bullish divergence.
  - Optional Filter: Choppiness Index > 61.8 (indicating a ranging market favorable for BB mean reversion).
  - Enter on a confirming candle (e.g., price closes back inside the Lower Band, or a bullish candle pattern forms).
  
  
• Entry (Short): Reverse logic for Upper Bollinger Band and overbought RSI (e.g., above 70) or bearish divergence.
  
  
• Management: Stop-loss beyond the recent swing low/high or a multiple of ATR. Target the Bollinger Band basis line or the opposite band.
  

2. Stochastic Oversold/Overbought with Pivot Point Support/Resistance

• Goal: Trade bounces from key Pivot Point levels when confirmed by Stochastic extremes.
  
  
• Setup: Enable Stochastic (e.g., 14,3,3), Pivot Points (e.g., Daily Traditional), and Fast MA (e.g., 9 EMA) for short-term trend context.
  
  
• Entry (Long):
  - Price approaches a significant Pivot Support level (S1, S2).
  - Stochastic %K and %D lines are in the oversold region (e.g., below 20) and ideally show a bullish crossover (%K crosses above %D).
  - Optional Filter: Price is above the Fast MA, or the Fast MA starts to slope up.
  - Enter on signs of price rejection at the Pivot level.
  
  
• Entry (Short): Reverse logic for Pivot Resistance levels (R1, R2) and overbought Stochastic (e.g., above 80) with a bearish crossover.
  
  
• Management: Stop-loss below the Pivot Support (for longs) or above Pivot Resistance (for shorts). Target the next Pivot level or a fixed risk-reward ratio.
  

3. RSI Divergence at Keltner Channel Extremes

• Goal: Capitalize on weakening momentum (divergence) as price tests the outer Keltner Channel bands.
  
  
• Setup: Enable RSI (with Divergence plotting enabled), Keltner Channels (e.g., 20,2 EMA basis, ATR 10), and ATR (for stop placement).
  
  
• Entry (Long):
  - Price is testing or near the Lower Keltner Channel band.
  - A Bullish RSI Divergence is plotted (price makes a lower low, but RSI makes a higher low).
  - Enter once the divergence is confirmed and price shows signs of turning up.
  
  
• Entry (Short):
  - Price is testing or near the Upper Keltner Channel band.
  - A Bearish RSI Divergence is plotted (price makes a higher high, but RSI makes a lower high).
  - Enter once divergence is confirmed and price shows signs of turning down.
  
  
• Management: Place stop-loss based on ATR (e.g., 1.5x ATR below entry for longs) or beyond the Keltner Channel. Target could be the Keltner basis line or a measured move.
  

█ CONCLUSION

The Mean Reversion Bundle offers a sophisticated yet user-friendly suite of tools essential for traders focusing on mean reversion. By consolidating these powerful indicators, providing extensive customization, multi-timeframe analysis, and integrated alerts, this bundle simplifies the analytical workflow and aids in the development of more robust and nuanced trading strategies. Whether identifying potential exhaustion points, confirming overbought/oversold conditions, or finding precise entry near dynamic support/resistance, this bundle is a versatile asset for your technical analysis toolkit.


█ IMPORTANT NOTES

⚠ Parameter Optimization: The default settings are starting points. Always adjust indicator parameters (lengths, multipliers, levels) based on the specific asset, its volatility, and the timeframe you are trading. Thorough backtesting is crucial.

⚠ Multi-Timeframe Dynamics: Using the "Timeframe" input can be very powerful. If "Wait TF Close" is enabled (default), signals from higher timeframes will only update upon the close of that higher timeframe bar. Disabling it may lead to signals changing intra-bar.

⚠ Confluence is Key: Avoid relying on a single indicator. The strength of this bundle lies in combining signals from multiple indicators to build a confluence case for a trade.

⚠ Chart Clarity: While many tools are available, only enable those pertinent to your current strategy to maintain a clear and actionable chart.

⚠ Signal Confirmation: Indicator signals are typically finalized on bar close. Be cautious when acting on intra-bar signals, as they can change before the bar is complete. Using "Once Per Bar Close" for alerts is generally recommended for mean reversion signals.


█ RISK DISCLAIMER

Trading involves a substantial risk of loss and is not suitable for all investors. The Mean Reversion Bundle indicator is provided for educational and informational purposes only. It does NOT constitute financial advice or a recommendation to buy or sell any asset. Indicator signals identify potential patterns based on historical data but do not guarantee future price movements or profitability. Always conduct your own thorough research, utilize multiple sources of information, and implement robust risk management practices before making any trading decisions. Past performance is not indicative of future results.

📊 Happy trading! 🚀