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Strategies›RSI / SMA Cross
RSI / SMA Cross master

RSI / SMA Cross Strategy

A momentum signal that triggers when the RSI crosses its own moving average — combining oversold detection with trend confirmation.

Try in Arena →View Live Insights →

Quick Facts

Type:
Mean Reversion · Momentum
Plan:
Free
Asset Classes:
Crypto · Tokenized RWA
Indicators:
RSI · SMA

Platform Backtest

ⓘ
CAGR
+20.0%
Win Rate
30%
Max DD
-34%

Default parameters · BTCUSDT · 1d · 4 years · B&H +31.0%

How It Works

The RSI (Relative Strength Index) measures recent price strength on a 0-to-100 scale. Values above 70 suggest overbought conditions, below 30 oversold. The SMA (Simple Moving Average) smooths the RSI itself — not the price. By comparing the RSI to its own moving average, the strategy filters out noise and waits for momentum to build before acting.

Entry signal: when the RSI crosses above its SMA, momentum is shifting upward — a buy signal.

Exit signal: when the RSI crosses below its SMA, momentum is fading — a sell signal.

Unlike pure RSI overbought/oversold strategies, this approach reduces whipsaws by requiring confirmation through the moving average. It also adapts to changing market regimes: in a strong uptrend, the RSI's SMA naturally rises along with price strength, so the strategy doesn't prematurely exit just because RSI has crossed an arbitrary 70 line.

Entry & Exit Rules

▲Entry

  • ●RSI crosses above its own SMA
  • ●Position is currently flat (no open trade)

▼Exit

  • ●RSI crosses below its own SMA
  • ●Position is currently long

Parameters

NameDefaultRangeDescription
RSI Period142–50Number of candles used for the RSI calculation. Default 14, the value originally proposed by J. Welles Wilder.
SMA Period142–100Number of RSI values smoothed via simple moving average. Higher = slower & fewer signals.

Live Backtest

Strategy CAGR
+20.0%
Buy & Hold CAGR
+31.0%
Trades
234
Win Rate
30%
Y-axis: Equity (USD, $10,000 starting capital)2022-07-23 → 2026-07-22

BTCUSDT · 1d · 4 years · default parameters · refreshed daily

Run with my own parameters →

Performance per Asset

Top-10 assets by average CAGR (1w interval), aggregated from community + platform backtests. Actual results depend on parameters and period.

AssetCAGRvs B&H★Win%YearsRuns
FTMUSDT+123.2%+16.8pp9142%5.615
SUIUSDT+89.5%+98.7pp—44%3.112
FETUSDT+84.4%+90.6pp8838%6.77
ANKRUSDT+80.6%+91.2pp—42%6.34
CHZUSDT+74.3%+52.9pp—44%6.818
ONEUSDT+68.0%+99.1pp—44%6.45
PEPEUSDT+60.5%+54.5pp—37%3.113
THETAUSDT+52.9%+45.4pp—45%7.218
HBARUSDT+52.1%+30.2pp—36%6.717
PROMUSDT+51.8%+83.0pp—55%2.64
pp = delta vs avg-B&H · ★ = robustness score 0-100 (CAGR / win-rate / drawdown / consistency).Full Insights →

Pseudo-Code

expand
// Entry
if RSI(rsi_period) crosses_above SMA(RSI, sma_period):
  if position.is_flat:
    BUY

// Exit
if RSI(rsi_period) crosses_below SMA(RSI, sma_period):
  if position.is_long:
    SELL

Strengths & Weaknesses

+Strengths

  • ●Reduces whipsaws compared to raw RSI threshold strategies
  • ●Works across all asset classes including forex (no volume needed)
  • ●Simple to understand and tune (only 2 parameters)
  • ●Adaptive: the SMA threshold rises and falls with market conditions

−Weaknesses

  • ●Lags pure price-based signals — late entries in fast moves
  • ●Performs poorly in extended ranging markets (many false crosses)
  • ●No volatility or trend filter — entries can occur in unfavourable regimes
  • ●Both periods on the same scale (14/14) means the SMA can chase the RSI closely, increasing crosses

Frequently Asked Questions

What's the difference between RSI/SMA Cross and pure RSI overbought/oversold?+

Pure RSI uses fixed thresholds (e.g. buy when RSI < 30, sell when RSI > 70). RSI/SMA Cross uses a dynamic threshold — the SMA of the RSI itself. The dynamic threshold adapts to changing market conditions and reduces false signals during persistent trends, where the RSI can stay above 70 for weeks without the asset actually being overbought.

Which timeframes work best?+

Daily and weekly timeframes generally produce more reliable signals than intraday — fewer false crosses, less sensitivity to news spikes. The strategy is available on all intervals supported by your plan; we recommend starting with 1d on Bitcoin to see the canonical behaviour.

Can I combine this with the WMA Filter or ATR Filter?+

Yes. All entry filters (200 WMA, ATR Volatility, Altcoin Season, Min. Profit Guard) can be combined with this strategy on Pro and Elite plans. Filters are applied sequentially before each entry signal, so e.g. a buy signal is only executed if the price is above the 200-week MA.

Why are both default periods 14?+

14 is the canonical RSI period from Wilder's 1978 book. Using 14 for both keeps the strategy comparable to the literature. If you want fewer signals and less noise, try increasing the SMA period (e.g. 28 or 50) while keeping the RSI period at 14.

Related Strategies

RSI Overbought / Oversold

The textbook RSI strategy — buy when oversold (RSI < 30), sell when overbought (RSI > 70). Best in sideways markets.

RSI

Stoch-RSI / SMA Cross

A faster RSI variant — the Stochastic RSI crosses its own moving average. More trades, more sensitivity, ideal for active markets.

Stoch-RSI · SMA

EMA Trend Bias

Two EMAs plus an ATR-based neutral zone — like the commercial Larsson Line, but tunable, transparent, and backtested. Choose your bias.

EMA · ATR

Don't want to backtest yourself?

Check out our Strategy Insights Reports — pre-baked deep-dives with historical results, comparisons, and market context.

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