Adaptive AlgoSignal

This indicator implements a quantitative approach designed to explore how different Relative Strength Index (RSI) levels interact with multiple risk-reward configurations. The goal is to help traders identify statistically favorable combinations of entry levels, stop-loss placement and profit targets within a consistent trading framework.

Instead of relying on a single RSI configuration, the indicator systematically evaluates a wide range of parameter combinations to reveal how performance changes across a structured matrix of RSI levels and reward-to-risk setups — all from one unified tool.

Initial development and optimization targeted BTCUSD on the 15-minute timeframe, but it can be applied and tested on other assets and timeframes.


CORE CONCEPT

1. RSI Multi-Level Signal Engine

The indicator analyzes different RSI level configurations (Config 1, Config 2, Config 3, …) that define entry regions based on overbought (potential sell zones) and oversold (potential buy zones) conditions.

The settings include:
• Oversold levels: 20, 25, 30, 35, 40
• Overbought levels: 60, 65, 70, 75, 80


2. Risk-Reward (RR) Matrix

Each RSI configuration is evaluated together with a set of risk-reward (RR) ratios, ranging from conservative to more aggressive targets:

RR 1.0 | RR 1.5 | RR 2.0 | RR 2.5 | RR 3.0 | RR 3.5 | RR 4.0

Combining these two dimensions generates approximately 70 different configurations, allowing the user to systematically examine how entry thresholds and profit targets interact and which combination yields the best performance metrics (win rate, net profit, etc.).


3. Entry & Exit Logic

• Long Signal: Triggered when RSI crosses above the selected
oversold level (e.g., RSI crossing up through 30), indicating
a potential bullish reversal.
• Short Signal: Triggered when RSI crosses below the selected
overbought level (e.g., RSI crossing down through 70), indicating
a potential bearish reversal.
• Take Profit: Calculated based on the selected risk-reward ratio
applied to the stop-loss distance.
• Stop Loss: Placed automatically or manually, depending on
user configuration (see below).


KEY FEATURES & SETTINGS

Take Profit & Stop Loss Management

• Partial Take Profit: Users can enable partial position closing
at a predefined profit level before the full take-profit target
is reached. This allows locking in gains while leaving a portion
of the position open for further upside.

• Stop-Loss Modes:
• Automatic Stop-Loss: The indicator calculates stop-loss
placement dynamically based on recent price structure.
• Manual Stop-Loss: Users can define a fixed stop-loss
distance (in percentage) according to their personal risk
management preferences.


Trailing Stop Options

• Classic Trailing Stop: The stop-loss follows price in the
favorable direction by a fixed distance, progressively
locking in profits.

• Flexible Trailing Stop (Second-Touch Mode): A more lenient
trailing mechanism where the stop-loss is only activated upon
the second touch of the trailing stop zone. This is designed
to reduce premature stop-outs caused by brief, temporary
pullbacks or wicks, giving the trade more room to breathe
while still protecting capital. This mode is particularly
useful in volatile markets like crypto where false stop-outs
are common.


One-Way Mode

When enabled, the indicator restricts signals to a single direction only — either Long-only or Short-only. This is useful for traders who have a directional bias based on higher-timeframe analysis or market structure and want to filter out counter-trend signals.


VOLATILITY FILTERS

To avoid generating signals during unfavorable market conditions, the indicator includes volatility filters calculated over different time scales (short, medium, or long-term volatility). These filters help the user focus on periods where market conditions are more aligned with the selected trading configuration.


PERFORMANCE ANALYSIS

Built-in Performance Table

The indicator includes an integrated backtesting engine that displays key performance metrics directly on the chart via an on-chart table. Metrics include:

• Total number of trades
• Win rate (%)
• Net profit / Net loss
• Profit factor
• Maximum drawdown

This allows traders to quickly scan across the 70 combinations and compare results directly on the chart, without needing external tools or manual calculations.


Custom Date Range

Users can specify a custom start and end date for all calculations and backtesting. This allows focused analysis on specific market regimes (e.g., bull markets, bear markets, high-volatility periods) to understand how different combinations perform under varying conditions.


HOW TO USE

1. Apply the indicator to your chart.
Default optimization: BTC, 15-minute timeframe.
2. Choose a configuration (Config 1, Config 2, etc.) from the
input settings to select your RSI level pair.
3. Select a Risk-Reward ratio to define your take-profit target
relative to stop-loss.
4. Configure your stop-loss mode (automatic or manual) and
trailing stop preference (classic or flexible).
5. Apply volatility filters if desired to refine signal quality.
6. Set your backtest date range to analyze performance over
your preferred period.
7. Review the on-chart performance table to evaluate results
for the selected configuration.
8. Iterate: Try different configurations to find the combination
that best suits your trading style, asset, and current
market environment.


DISCLAIMER & RISK WARNING

• Past performance is NOT indicative of future results. All
backtesting results displayed by this indicator are hypothetical
and subject to limitations including but not limited to
curve-fitting and market regime changes.
• This indicator is a tool for analysis and education, not
financial advice.
• Always apply proper risk management. It is recommended to
risk no more than 1-5% of account equity per trade to ensure
sustainable trading.
• The signals and performance metrics generated by this indicator
do not account for slippage.