The STRATEGY_RSI_BB_CROSS strategy is a backtesting strategy that uses a combination of the Relative Strength Index (RSI) and Bollinger Bands indicators to generate buy and sell signals for trading. In the populate_indicators function, several indicators are calculated and added to the input dataframe. These indicators include Bollinger Bands (with upper, middle, and lower bands), Bollinger Bands percentage, RSI, and RSI percentage.
These indicators are used in the buy and sell decision-making process.
The populate_buy_trend function populates the buy signal in the dataframe based on certain conditions.
The buy signal is triggered when the following conditions are met:
The Bollinger Bands percentage crosses above the RSI percentage. The Bollinger Bands percentage is less than 0.5. The RSI percentage is less than 0.5. The bb_below_rsi_count indicator is True (as calculated in the populate_indicators function) in the previous time step. Similarly, the populate_sell_trend function populates the sell signal in the dataframe based on certain conditions. The sell signal is triggered when the following conditions are met:
The Bollinger Bands percentage crosses below the RSI percentage. The Bollinger Bands percentage is greater than 0.5. The RSI percentage is greater than 0.5. The bb_above_rsi_count indicator is True (as calculated in the populate_indicators function) in the previous time step. Overall, this strategy aims to capture potential buying opportunities when the Bollinger Bands and RSI indicators align in a specific way, and it suggests selling opportunities when the opposite alignment occurs.