PROTECTED SOURCE SCRIPT
Aktualisiert DM Mean Reversion w/ VIX Ver2
CALL (Long)
Take CALL trades when ALL are true:
Price is above 200 SMA
RSI(2) is below 5
VIX is below 25
VIX is falling
Meaning:
Fear is low and decreasing → good environment for upside mean-reversion.
PUT (Short) – Final Rules
Take PUT trades when ALL are true:
Price is below 200 SMA
RSI(2) is above 95
VIX is between 25 and 30
VIX is rising
Meaning:
Fear exists, is increasing, but hasn’t turned into panic yet.
Universal Block Rule
If VIX is above 30 → NO TRADES at all
Because panic destroys mean-reversion edges.
_________________________________________________________________________________
The Psychology Behind Mean Reversion Strategy
Strategy is built on human behavior, not just math.
It’s designed to exploit how traders overreact emotionally.
1. RSI(2) – The Emotion Meter
What it means psychologically:
RSI(2) doesn’t measure trend —
it measures emotional exhaustion.
When:
• RSI(2) < 5 → Market is panic-selling short term
• RSI(2) > 95 → Market is panic-buying short term
Humans don’t trade logically. They:
Chase
Panic
Overreact to short-term movement
This strategy does the opposite.
It says:
Everyone is emotional right now.
I’m going to wait until their emotion is extreme, then fade it.”
That’s contrarian psychology.
2. 200 SMA – Crowd Bias Filter
This line separates:
Long-term belief
From short-term noise
Psychologically:
When price is above the 200 SMA
→ The market believes it's in a bull environment
When price is below the 200 SMA
→ The market believes it's in a bearish environment
Your strategy respects that belief.
You’re not fighting the big crowd
You’re only fading the small emotional moves within it.
That’s very important.
3. 5 SMA – Short-Term Reversion Trigger
This is your mean line.
Psychologically:
When price stretches far from the 5 SMA,
it represents short-term imbalance.
Traders:
• Chase
• Overextend
• Get emotionally trapped
The mean (5 SMA) acts like a magnet.
Your exit uses this line because:
When price touches or crosses it
that emotional imbalance is usually gone.
4. ATR – Fear Distance
ATR measures how far the crowd is willing to move price.
Psychologically:
When volatility increases,
people are emotional
Stop loss distance must increase
Your ATR stop adapts to crowd fear intensity.
Low fear = tighter stops
High fear = wider stops
You're not using fixed numbers.
You're using fear measurement.
5. VIX – The Market's Fear Index
This is extremely important.
VIX shows collective fear levels across all traders.
Psychology:
VIX Level Crowd Emotion
Under 20 Calm / Confident
20–25 Mild stress
25–30 Building fear
30+ Panic mode
Mean reversion works best when:
Fear exists
But panic is NOT extreme
Because in panic → people act irrational longer.
Your logic filters those periods out.
6. Your Strategy Psychology in One Sentence
Your strategy profits from:
✅ Short-term emotional overreactions
✅ Inside longer-term structural bias
✅ While avoiding high-panic environments
You're trading:
Not price
Not indicators
But human stress behavior.
The Mental Model to Remember
Imagine:
RSI(2) = person panicking
200 SMA = direction of the crowd
5 SMA = emotional center
ATR = how scared they are
VIX = how stressed the entire market is
You’re not predicting price.
You’re exploiting fear.
Take CALL trades when ALL are true:
Price is above 200 SMA
RSI(2) is below 5
VIX is below 25
VIX is falling
Meaning:
Fear is low and decreasing → good environment for upside mean-reversion.
PUT (Short) – Final Rules
Take PUT trades when ALL are true:
Price is below 200 SMA
RSI(2) is above 95
VIX is between 25 and 30
VIX is rising
Meaning:
Fear exists, is increasing, but hasn’t turned into panic yet.
Universal Block Rule
If VIX is above 30 → NO TRADES at all
Because panic destroys mean-reversion edges.
_________________________________________________________________________________
The Psychology Behind Mean Reversion Strategy
Strategy is built on human behavior, not just math.
It’s designed to exploit how traders overreact emotionally.
1. RSI(2) – The Emotion Meter
What it means psychologically:
RSI(2) doesn’t measure trend —
it measures emotional exhaustion.
When:
• RSI(2) < 5 → Market is panic-selling short term
• RSI(2) > 95 → Market is panic-buying short term
Humans don’t trade logically. They:
Chase
Panic
Overreact to short-term movement
This strategy does the opposite.
It says:
Everyone is emotional right now.
I’m going to wait until their emotion is extreme, then fade it.”
That’s contrarian psychology.
2. 200 SMA – Crowd Bias Filter
This line separates:
Long-term belief
From short-term noise
Psychologically:
When price is above the 200 SMA
→ The market believes it's in a bull environment
When price is below the 200 SMA
→ The market believes it's in a bearish environment
Your strategy respects that belief.
You’re not fighting the big crowd
You’re only fading the small emotional moves within it.
That’s very important.
3. 5 SMA – Short-Term Reversion Trigger
This is your mean line.
Psychologically:
When price stretches far from the 5 SMA,
it represents short-term imbalance.
Traders:
• Chase
• Overextend
• Get emotionally trapped
The mean (5 SMA) acts like a magnet.
Your exit uses this line because:
When price touches or crosses it
that emotional imbalance is usually gone.
4. ATR – Fear Distance
ATR measures how far the crowd is willing to move price.
Psychologically:
When volatility increases,
people are emotional
Stop loss distance must increase
Your ATR stop adapts to crowd fear intensity.
Low fear = tighter stops
High fear = wider stops
You're not using fixed numbers.
You're using fear measurement.
5. VIX – The Market's Fear Index
This is extremely important.
VIX shows collective fear levels across all traders.
Psychology:
VIX Level Crowd Emotion
Under 20 Calm / Confident
20–25 Mild stress
25–30 Building fear
30+ Panic mode
Mean reversion works best when:
Fear exists
But panic is NOT extreme
Because in panic → people act irrational longer.
Your logic filters those periods out.
6. Your Strategy Psychology in One Sentence
Your strategy profits from:
✅ Short-term emotional overreactions
✅ Inside longer-term structural bias
✅ While avoiding high-panic environments
You're trading:
Not price
Not indicators
But human stress behavior.
The Mental Model to Remember
Imagine:
RSI(2) = person panicking
200 SMA = direction of the crowd
5 SMA = emotional center
ATR = how scared they are
VIX = how stressed the entire market is
You’re not predicting price.
You’re exploiting fear.
Versionshinweise
CALL (Long)Take CALL trades when ALL are true:
Price is above 200 SMA
RSI(2) is below 5
VIX is below 25
VIX is falling
Meaning:
Fear is low and decreasing → good environment for upside mean-reversion.
PUT (Short) – Final Rules
Take PUT trades when ALL are true:
Price is below 200 SMA
RSI(2) is above 95
VIX is between 25 and 30
VIX is rising
Meaning:
Fear exists, is increasing, but hasn’t turned into panic yet.
Universal Block Rule
If VIX is above 30 → NO TRADES at all
Because panic destroys mean-reversion edges.
_________________________________________________________________________________
The Psychology Behind Mean Reversion Strategy
Strategy is built on human behavior, not just math.
It’s designed to exploit how traders overreact emotionally.
1. RSI(2) – The Emotion Meter
What it means psychologically:
RSI(2) doesn’t measure trend —
it measures emotional exhaustion.
When:
• RSI(2) < 5 → Market is panic-selling short term
• RSI(2) > 95 → Market is panic-buying short term
Humans don’t trade logically. They:
Chase
Panic
Overreact to short-term movement
This strategy does the opposite.
It says:
Everyone is emotional right now.
I’m going to wait until their emotion is extreme, then fade it.”
That’s contrarian psychology.
2. 200 SMA – Crowd Bias Filter
This line separates:
Long-term belief
From short-term noise
Psychologically:
When price is above the 200 SMA
→ The market believes it's in a bull environment
When price is below the 200 SMA
→ The market believes it's in a bearish environment
Your strategy respects that belief.
You’re not fighting the big crowd
You’re only fading the small emotional moves within it.
That’s very important.
3. 5 SMA – Short-Term Reversion Trigger
This is your mean line.
Psychologically:
When price stretches far from the 5 SMA,
it represents short-term imbalance.
Traders:
• Chase
• Overextend
• Get emotionally trapped
The mean (5 SMA) acts like a magnet.
Your exit uses this line because:
When price touches or crosses it
that emotional imbalance is usually gone.
4. ATR – Fear Distance
ATR measures how far the crowd is willing to move price.
Psychologically:
When volatility increases,
people are emotional
Stop loss distance must increase
Your ATR stop adapts to crowd fear intensity.
Low fear = tighter stops
High fear = wider stops
You're not using fixed numbers.
You're using fear measurement.
5. VIX – The Market's Fear Index
This is extremely important.
VIX shows collective fear levels across all traders.
Psychology:
VIX Level Crowd Emotion
Under 20 Calm / Confident
20–25 Mild stress
25–30 Building fear
30+ Panic mode
Mean reversion works best when:
Fear exists
But panic is NOT extreme
Because in panic → people act irrational longer.
Your logic filters those periods out.
6. Your Strategy Psychology in One Sentence
Your strategy profits from:
✅ Short-term emotional overreactions
✅ Inside longer-term structural bias
✅ While avoiding high-panic environments
You're trading:
Not price
Not indicators
But human stress behavior.
The Mental Model to Remember
Imagine:
RSI(2) = person panicking
200 SMA = direction of the crowd
5 SMA = emotional center
ATR = how scared they are
VIX = how stressed the entire market is
You’re not predicting price.
You’re exploiting fear.
Versionshinweise
CALL (Long)Take CALL trades when ALL are true:
Price is above 200 SMA
RSI(2) is below 5
VIX is below 25
VIX is falling
Meaning:
Fear is low and decreasing → good environment for upside mean-reversion.
PUT (Short) – Final Rules
Take PUT trades when ALL are true:
Price is below 200 SMA
RSI(2) is above 95
VIX is between 25 and 30
VIX is rising
Meaning:
Fear exists, is increasing, but hasn’t turned into panic yet.
Universal Block Rule
If VIX is above 30 → NO TRADES at all
Because panic destroys mean-reversion edges.
_________________________________________________________________________________
The Psychology Behind Mean Reversion Strategy
Strategy is built on human behavior, not just math.
It’s designed to exploit how traders overreact emotionally.
1. RSI(2) – The Emotion Meter
What it means psychologically:
RSI(2) doesn’t measure trend —
it measures emotional exhaustion.
When:
• RSI(2) < 5 → Market is panic-selling short term
• RSI(2) > 95 → Market is panic-buying short term
Humans don’t trade logically. They:
Chase
Panic
Overreact to short-term movement
This strategy does the opposite.
It says:
Everyone is emotional right now.
I’m going to wait until their emotion is extreme, then fade it.”
That’s contrarian psychology.
2. 200 SMA – Crowd Bias Filter
This line separates:
Long-term belief
From short-term noise
Psychologically:
When price is above the 200 SMA
→ The market believes it's in a bull environment
When price is below the 200 SMA
→ The market believes it's in a bearish environment
Your strategy respects that belief.
You’re not fighting the big crowd
You’re only fading the small emotional moves within it.
That’s very important.
3. 5 SMA – Short-Term Reversion Trigger
This is your mean line.
Psychologically:
When price stretches far from the 5 SMA,
it represents short-term imbalance.
Traders:
• Chase
• Overextend
• Get emotionally trapped
The mean (5 SMA) acts like a magnet.
Your exit uses this line because:
When price touches or crosses it
that emotional imbalance is usually gone.
4. ATR – Fear Distance
ATR measures how far the crowd is willing to move price.
Psychologically:
When volatility increases,
people are emotional
Stop loss distance must increase
Your ATR stop adapts to crowd fear intensity.
Low fear = tighter stops
High fear = wider stops
You're not using fixed numbers.
You're using fear measurement.
5. VIX – The Market's Fear Index
This is extremely important.
VIX shows collective fear levels across all traders.
Psychology:
VIX Level Crowd Emotion
Under 20 Calm / Confident
20–25 Mild stress
25–30 Building fear
30+ Panic mode
Mean reversion works best when:
Fear exists
But panic is NOT extreme
Because in panic → people act irrational longer.
Your logic filters those periods out.
6. Your Strategy Psychology in One Sentence
Your strategy profits from:
✅ Short-term emotional overreactions
✅ Inside longer-term structural bias
✅ While avoiding high-panic environments
You're trading:
Not price
Not indicators
But human stress behavior.
The Mental Model to Remember
Imagine:
RSI(2) = person panicking
200 SMA = direction of the crowd
5 SMA = emotional center
ATR = how scared they are
VIX = how stressed the entire market is
You’re not predicting price.
You’re exploiting fear.
17 minutes ago
Release Notes
CALL (Long)
Take CALL trades when ALL are true:
Price is above 200 SMA
RSI(2) is below 5
VIX is below 25
VIX is falling
Meaning:
Fear is low and decreasing → good environment for upside mean-reversion.
PUT (Short) – Final Rules
Take PUT trades when ALL are true:
Price is below 200 SMA
RSI(2) is above 95
VIX is between 25 and 30
VIX is rising
Meaning:
Fear exists, is increasing, but hasn’t turned into panic yet.
Universal Block Rule
If VIX is above 30 → NO TRADES at all
Because panic destroys mean-reversion edges.
_________________________________________________________________________________
The Psychology Behind Mean Reversion Strategy
Strategy is built on human behavior, not just math.
It’s designed to exploit how traders overreact emotionally.
1. RSI(2) – The Emotion Meter
What it means psychologically:
RSI(2) doesn’t measure trend —
it measures emotional exhaustion.
When:
• RSI(2) < 5 → Market is panic-selling short term
• RSI(2) > 95 → Market is panic-buying short term
Humans don’t trade logically. They:
Chase
Panic
Overreact to short-term movement
This strategy does the opposite.
It says:
Everyone is emotional right now.
I’m going to wait until their emotion is extreme, then fade it.”
That’s contrarian psychology.
2. 200 SMA – Crowd Bias Filter
This line separates:
Long-term belief
From short-term noise
Psychologically:
When price is above the 200 SMA
→ The market believes it's in a bull environment
When price is below the 200 SMA
→ The market believes it's in a bearish environment
Your strategy respects that belief.
You’re not fighting the big crowd
You’re only fading the small emotional moves within it.
That’s very important.
3. 5 SMA – Short-Term Reversion Trigger
This is your mean line.
Psychologically:
When price stretches far from the 5 SMA,
it represents short-term imbalance.
Traders:
• Chase
• Overextend
• Get emotionally trapped
The mean (5 SMA) acts like a magnet.
Your exit uses this line because:
When price touches or crosses it
that emotional imbalance is usually gone.
4. ATR – Fear Distance
ATR measures how far the crowd is willing to move price.
Psychologically:
When volatility increases,
people are emotional
Stop loss distance must increase
Your ATR stop adapts to crowd fear intensity.
Low fear = tighter stops
High fear = wider stops
You're not using fixed numbers.
You're using fear measurement.
5. VIX – The Market's Fear Index
This is extremely important.
VIX shows collective fear levels across all traders.
Psychology:
VIX Level Crowd Emotion
Under 20 Calm / Confident
20–25 Mild stress
25–30 Building fear
30+ Panic mode
Mean reversion works best when:
Fear exists
But panic is NOT extreme
Because in panic → people act irrational longer.
Your logic filters those periods out.
6. Your Strategy Psychology in One Sentence
Your strategy profits from:
✅ Short-term emotional overreactions
✅ Inside longer-term structural bias
✅ While avoiding high-panic environments
You're trading:
Not price
Not indicators
But human stress behavior.
The Mental Model to Remember
Imagine:
RSI(2) = person panicking
200 SMA = direction of the crowd
5 SMA = emotional center
ATR = how scared they are
VIX = how stressed the entire market is
You’re not predicting price.
You’re exploiting fear.
Geschütztes Skript
Dieses Script ist als Closed-Source veröffentlicht. Sie können es kostenlos und ohne Einschränkungen verwenden – erfahren Sie hier mehr.
Haftungsausschluss
Die Informationen und Veröffentlichungen sind nicht als Finanz-, Anlage-, Handels- oder andere Arten von Ratschlägen oder Empfehlungen gedacht, die von TradingView bereitgestellt oder gebilligt werden, und stellen diese nicht dar. Lesen Sie mehr in den Nutzungsbedingungen.
Geschütztes Skript
Dieses Script ist als Closed-Source veröffentlicht. Sie können es kostenlos und ohne Einschränkungen verwenden – erfahren Sie hier mehr.
Haftungsausschluss
Die Informationen und Veröffentlichungen sind nicht als Finanz-, Anlage-, Handels- oder andere Arten von Ratschlägen oder Empfehlungen gedacht, die von TradingView bereitgestellt oder gebilligt werden, und stellen diese nicht dar. Lesen Sie mehr in den Nutzungsbedingungen.