Cuban's Reversion Bands V2

9 Jan 2023

Cuban's Reversion Bands V2

Cubans Reversion Bands, are a great indication of price overextension by using specified standard deviations, extended from a moving average basis line, the Volume Weighted Average Trend.

Reversion Bands V2 builds off the original foundation in a big way but utilizes completely new band logic and a more stable basis line, the stability leads to a more consistent band reversion zones.

The basis line is calculated with volatility metrics and long term range determinants.

The band extension points are then weighted on this basis line with the asset's average extensions taken into consideration to fit each asset individually.

Users gain the ability to customize:

• [] EQ Sensitivity
  [] Band Sensitivity
  

EQ sensitivity will control the reaction time of the basis line e.g. a comparison of the default 1, and below an increase EQ to 100:

1 EQ Sensitivity (Default)



100 EQ Sensitivity


Band Sensitivity will control the distance of deviation from the basis point, this can be used to fine tune the reversion location which could be useful in higher beta environments.

1 Band Sensitivity


100 Band Sensitivity


As a result of overextension we can take this as a means for a potential market shift, for example, in range bound conditions we expect the market to revert at the given reversion zones in the Cuban Reversion Bands V2.

Failure to revert at a band level, and extension above could signify a change in market structure and lead to a trending environment thus giving us the ability to determine a trending environment.

To Do:
* alerts
* implement additional confluence via other proprietary tools to increase the signal ratio

19 Jan 2023

Nota Keluaran

• added orange coloring for potential early warning band trend change