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Mean reversion · SMCI · 1D

Does Three-down-days bounce actually work on SMCI? We tested it

We ran Three-down-days bounce on SMCI through walk-forward testing and a 100-run random-entry gauntlet. 3 of 4 unseen periods positive. Beat 89 of 100 random-entry runs.

WALK-FORWARD VERIFIED EDGESTACKER ENGINE
Return +185.9%
Win rate 71.1%
Max drawdown −20.6%
Trades 76
Sharpe 0.77
Equity curve

Equity curve over Aug 2016 to Jul 2026. Hover any point for its value. Turn on buy and hold to compare.

PeriodWindowReturnSharpeTrades
1 Aug 2018 to Jul 2020 +18.0% 1.59 7
2 Jul 2020 to Jul 2022 +17.4% 1.06 26
3 Jul 2022 to Jul 2024 +103.0% 1.30 30
4 Jul 2024 to Jul 2026 −3.6% −0.16 9
3 of 4 periods positive. Mean Sharpe 0.95. Worst period −3.6%.
Market matrix
Edge held on 6 of 28

The same rules, tested on 28 tickers. Edge held on 6. We ship it on those.

SMCI SHIPPED
89/100 EDGE
NVDA
100/100 EDGE
MSFT
99/100 EDGE
MSTR
93/100 EDGE
QQQ
86/100 EDGE
GOOGL
82/100 EDGE
Show every ticker we tested
AAPL
87/100 NONE
TSLA
87/100 NONE
AMZN
75/100 NONE
NFLX
72/100 NONE
UBER
68/100 NONE
AVGO
67/100 NONE
MU
66/100 NONE
AMD
63/100 NONE
IWM
59/100 NONE
XOM
57/100 NONE
META
56/100 NONE
RIOT
50/100 NONE
SPY
36/100 NONE
COIN
31/100 NONE
DIA
27/100 NONE
GLD
20/100 NONE
JPM
16/100 NONE
MARA
7/100 NONE
BA
7/100 NONE
SOFI
2/100 NONE
PLTR
too new TOO NEW
HOOD
too new TOO NEW
The rules
Entrywhen close is above SMA of close over 200 bars AND close is below close 1 bar ago AND close 1 bar ago is below close 2 bars ago AND close 2 bars ago is below close 3 bars ago
Exitwhen a signal fires (close is above close 1 bar ago), or 10 bars have passed since entry (time stop)
Sizing**Position size:** no fixed stop distance to size against. This strategy exits on signal only. Size by conviction, or add a hard stop for a size-by-risk number.
Diagnosis

This strategy made money overall, turning a 185.93% total return on SMCI, and it did so with a high win rate of 71.05%, meaning most trades were winners. However, the ride was not smooth; the max drawdown of -20.62% was a painful stretch from late May 2024 to August 2025, which is where the strategy hurt the most. The entry timing is a key strength here, as the real entries beat 89% of random entry runs, so the setup itself is doing the heavy lifting rather than the exits. The edge was also consistent, showing up in 3 out of 4 walk-forward test periods, so the results are not just from one lucky streak. Overall, this is a solid setup that makes money steadily, but you have to be prepared for a significant 20% drawdown that can last over a year.

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