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Mean reversion · NFLX · 1D

Does Bollinger dip in an uptrend actually work on NFLX? We tested it

We ran Bollinger dip in an uptrend on NFLX through walk-forward testing and a 100-run random-entry gauntlet. 3 of 4 unseen periods positive. Beat 81 of 100 random-entry runs.

WALK-FORWARD VERIFIED EDGESTACKER ENGINE
Return +61.2%
Win rate 77.3%
Max drawdown −44.6%
Trades 22
Sharpe 0.44
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 +25.4% 0.88 4
2 Jul 2020 to Jul 2022 −21.5% −0.37 4
3 Jul 2022 to Jul 2024 +7.5% 0.46 4
4 Jul 2024 to Jul 2026 +62.8% 2.04 8
3 of 4 periods positive. Mean Sharpe 0.75. Worst period −21.5%.
Market matrix
Edge held on 7 of 28

The same rules, tested on 28 tickers. Edge held on 7. We ship it on those.

NFLX SHIPPED
81/100 EDGE
GLD
93/100 EDGE
MSFT
88/100 EDGE
AVGO
87/100 EDGE
NVDA
86/100 EDGE
IWM
85/100 EDGE
MU
83/100 EDGE
Show every ticker we tested
UBER
90/100 NONE
SMCI
84/100 NONE
MSTR
76/100 NONE
AMZN
67/100 NONE
XOM
63/100 NONE
META
60/100 NONE
QQQ
59/100 NONE
DIA
58/100 NONE
SPY
55/100 NONE
GOOGL
54/100 NONE
AMD
49/100 NONE
JPM
46/100 NONE
RIOT
34/100 NONE
BA
28/100 NONE
TSLA
26/100 NONE
AAPL
7/100 NONE
PLTR
too new TOO NEW
COIN
too new TOO NEW
MARA
too new TOO NEW
HOOD
too new TOO NEW
SOFI
too new TOO NEW
The rules
Entrywhen close crosses below BBANDS lower band of close over 20 bars AND close is above SMA of close over 200 bars
Exitwhen a signal fires (close crosses above BBANDS middle band of close over 20 bars)
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 61% total return on Netflix over the test period. However, the ride was extremely lumpy, with a brutal maximum drawdown of nearly 45% that lasted from late 2021 into early 2023, which is where the strategy hurt the most. The high win rate of 77% and average trade gain of 2.78% suggest the setup caught many small winners, but the deep drawdown shows it got caught in a major downtrend. The entry timing appears to be doing the heavy lifting here, since the real entries beat 81% of random entry runs, meaning the specific moment you buy on the dip matters a lot. The edge was not consistent across all market conditions, as the strategy was profitable in only 3 out of 4 walk-forward test periods, indicating that the bulk of the gains likely came from one favorable stretch rather than steady performance.

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Backtested results, not live trading returns. Fees and slippage included. Not investment advice.