Topic: how to you deal with overbought / oversold
Hoping someone might help me with this.
When I trade manually I like to wait for a market to enter an oversold position before looking to enter long based on other indicators (similar overbought and short).
I am wondering if it is possible to achieve this in an automated strategy (that can be subsequently back-tested) where the crossing of the overbought or oversold level line may occur 1, 2, 3, more bars before the other entry conditions are satisfied.
In essence it is likely that the entry requirement is 2 stages, the indicator crosses the level line upwards, and only if this occurs, enter based on the strategy opening logic conditions as usual
could be using any number of indicators RSI, MFI, stochastic
assume the principal would be the same
my concern is that my entry conditions are likely not to occur in the same bar, but successive bars
any advice would be appreciated