The thesis
RSI Snap-Back bets on a simple, well-worn idea: the largest tech names tend to overshoot in the short term and then revert. The rule set is deliberately mechanical — enter a position when a name's RSI drops below 35, exit when it climbs above 70, and never hold more than four names at once. That hard four-slot book is the strategy's risk governor: it caps how many concurrent bets can go wrong at the same time and forces the strategy to rotate capital toward the most oversold candidate rather than accumulating a sprawling, correlated book.
The universe is the usual mega-cap suspects — AAPL, MSFT, NVDA, GOOGL, AMZN, META and TSLA. That focus is both the appeal and the catch, which we'll come back to.
Recent activity
The strategy reset to a clean $10,000 book on 29 October and has been cautious since. The 29 October run executed nothing. On 30 October it opened GOOGL (7 shares at $280.28), and on 2 November it added NVDA (10 shares at $204.04). As of the latest run the book sits at roughly $9,978 total with $5,957 in cash — essentially flat, marginally below the starting line, with slots still to fill. In other words, live trading is only days old and the strategy is still building into its positions. Nothing here contradicts the thesis yet, but there's no live edge to point to either.
Backtest and validation
The backtest is where the case is actually made. Over 451 days the strategy returned 20.95% (final equity $12,095, 11.21% CAGR) across 37 trades, with a 66.67% win rate. Fees were a trivial $37 and FX cost was zero — the all-USD, low-trade-count profile keeps frictions negligible despite a punchy 773% turnover.
The reviewer signed off at risk 0.35, citing sound mean-reversion logic, correct position sizing and cash tracking, and no look-ahead — with three minor defensive-coding gaps flagged as non-exploitable. Worth noting: an earlier backtest attempt failed the deployment gate outright (0% return, 0% drawdown) before this version cleared it, so the logic was iterated into shape rather than accepted first time.
Strengths and risks
Strengths. A two-thirds win rate and a positive, fee-adjusted return on a transparent rule set is a genuinely respectable result. The four-slot cap and clean cash accounting make the strategy easy to reason about and hard to blow up in a single bad name.
Risks. Three stand out. First, the Sharpe of 0.61 is modest — the returns came with real volatility, underlined by a 23.73% maximum drawdown. A strategy that can give back nearly a quarter of its equity needs a patient operator. Second, and most important, the validation field is null: there is no out-of-sample or walk-forward check here, so the backtest's edge is unconfirmed against overfitting. Third, concentrating entirely in the Mag-7 means the four slots are far from independent — in a broad tech selloff, 'oversold' names can keep falling together, and mean-reversion becomes a knife-catch.
Verdict
A clean, disciplined strategy with an encouraging backtest and an honest review trail. Until it logs out-of-sample validation and some live track record beyond its first week, treat the 20.95% as a hypothesis, not a result.