The Price Z-Score rule measures how far the latest close sits from its trailing mean, in units of standard deviation over your lookback. When the z-score is at or below −threshold, it fires buy; at or above +threshold, it fires sell.
Use it for classic mean-reversion on price level (fade extremes). It is different from Bollinger Bands (which touch fixed σ bands) and from Return Z-Score (which scores bar returns, not the price level).
When to use it
- Fade stretched closes after a calm window
- Confirm mean-reversion entries alongside RSI or other oscillators
- As a filter: only allow pending buys when price is unusually low (or sells when high)
What you’ll set in the app
Add Price Z-Score under entry, exit, increase, decrease, or reversal—or under filters for the same sections.
- Lookback — bars for mean and σ of closes (default 20)
- Z threshold — magnitude that triggers buy/sell (default 2)
Until enough history exists, or σ is zero, the rule does not fire.
Tips
- Threshold 2 is a common starting point; lower values fire more often.
- As a filter, the fired side must match the pending signal (invert flips that).
- Pair with session or volume filters if you only want extremes in liquid hours.
Example
Entry rules: Price Z-Score lookback 20, threshold 2, combined with RSI oversold. Buy when price is unusually low and RSI agrees.