Mean Reversion Half-Life & Spread Tracker [OnlyFibonacci] v3.0

This indicator is for educational and analytical purposes only. It does not constitute investment advice, financial advice, or a trading recommendation. Past signal performance does not guarantee future results. Always do your own research and manage risk responsibly.

• Two Operational Modes
  
  • Asset vs SMA (default): Analyzes Close / SMA ratio for single-asset mean reversion
  • Pair Trading: Analyzes chart symbol (Asset A) divided by a secondary symbol (Asset B)
• Z-Score Engine
  
  • Spread Ratio = Close/SMA or Close/Asset B
  • Z-Score = (Ratio − Rolling Mean) / Rolling Standard Deviation
  • Default lookback: 200 bars
  • EMA(3) smoothing applied to raw Z-Score to reduce whipsaw noise
• Threshold Levels
  
  • Upper threshold: +2.3 (statistical overbought zone)
  • Lower threshold: −2.3 (statistical oversold zone)
  • Center line: 0.0 (equilibrium / mean)
• Mean Closure Time
  
  • Tracks the average number of bars required for Z-Score to return to 0 after breaching ±2.3
  • Displays active spread duration in real time
  • Triggers a Time-Stop WARNING when duration exceeds the historical average
• Confirmed Signal Logic
  
  • BUY: Smoothed Z-Score crosses above −2.3 and holds beyond the threshold for at least 1 full confirmed bar close (bullish mean reversion)
  • SELL: Smoothed Z-Score crosses below +2.3 and holds beyond the threshold for at least 1 full confirmed bar close (bearish mean reversion)
  • EXIT: Z-Score reaches 0, time-stop is triggered, or duration exceeds 2× average closure time
• Signal Win Rate (%)
  
  • Historical success rate of confirmed signals
  • Win: Z-Score returns to 0 before exceeding 2× average closure time
  • Loss: Timeout or time-stop triggered before mean reversion completes
• Target Price Level
  
  • Estimated chart price where Z-Score would equal 0
  • MA mode: RatioMean × SMA
  • Pair mode: RatioMean × Asset B price
  • Optional dynamic dashed projection line on the main chart while a signal is active
• Visual Design (v3.0)
  
  • Dynamic gradient Z-Score line (red above 0, green below 0, neon tones at extremes)
  • Gradient-filled area between Z-Score and the zero line
  • Soft background glow in extreme zones
  • Modern dark-theme dashboard table with live status indicators
• Built-in Alerts
  
  • Upper / Lower Threshold Breach
  • Time-Stop Warning
  • Bullish Mean Reversion BUY
  • Bearish Mean Reversion SELL
  • Signal EXIT

1. Pair / Mode — active analysis configuration
2. Current Z-Score — real-time smoothed reading
3. Target Price Level — estimated Z=0 price
4. Avg Closure Time — historical mean reversion duration (bars)
5. Spread Duration — active deviation duration
6. Time-Stop Status — Normal or Warning
7. Signal Win Rate (%) — historical confirmed signal success rate

1. Add the indicator to your chart (separate oscillator pane).
2. In default Asset vs SMA mode, set the SMA length (default: 50).
3. For pair analysis, switch to Pair Trading mode and select Asset B.
4. Monitor the Z-Score panel:
   
   • Z > +2.3 → spread is statistically extended above mean (potential bearish mean reversion)
   • Z < −2.3 → spread is statistically extended below mean (potential bullish mean reversion)
   • Z ≈ 0 → statistical equilibrium
5. Compare Spread Duration against Avg Closure Time in the dashboard.
6. If Time-Stop shows WARNING, the deviation may be persisting longer than historically normal — review risk management.
7. Set alerts for threshold breaches, confirmed signals, and exits.

• Mean reversion concept: When price or spread reaches statistical extremes, it tends to revert toward its rolling mean over time.
• Z-Score: Measures deviation in standard deviation units. ±2.3 represents a strong statistical extreme.
• Avg Closure Time: How long past extreme deviations took to revert to zero. If current duration exceeds this, caution is warranted.
• Target Price: A dynamic estimate of where price may revert if Z-Score normalizes — a reference level, not a guaranteed target.
• Win Rate: A summary of past confirmed signal outcomes. Not a promise of future performance.
• Gradient fill: Visually emphasizes the magnitude and direction of deviation from equilibrium.

Horizontal dashed line on the main chart (if enabled): Projects the estimated price level where Z-Score = 0 while a BUY or SELL signal is active. It updates dynamically and disappears on EXIT or target reached. Disable via Show Target Price Projection Line.

• Single-asset mean reversion analysis vs SMA
• Crypto, forex, and equity pair spread monitoring
• Multi-timeframe confluence checks
• Alert-based watchlist monitoring
• Time-stop and duration-based risk awareness

• Mode, Asset B Symbol, MA Length
• Z-Score Lookback (200), EMA Smoothing (3)
• Upper/Lower Threshold (±2.3)
• Signal Confirmation Bars (1–5)
• Gradient Area Fill, Background Glow, Target Line, Dashboard

• Non-repainting security calls: gaps_off, lookahead_off
• This is an analysis tool — it does not execute trades automatically
• Parameters may require optimization across different markets and timeframes
• Win rate and closure time are based on historical data and may differ in live conditions
• Always use proper position sizing and risk management