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Does buying when RSI drops below 30 actually work?

A computed answer — not an opinion. Here's what nearly two decades of honest data say.

56OUT OF 100
WEAK — PROBABLY OVERFIT

More likely curve-fitting and luck than a durable pattern.

The honest verdict

We ran buying when RSI drops below 30 through an honest backtest — nearly two decades of survivorship-free NIFTY & BANKNIFTY data, out-of-sample, with real costs. The verdict: 56.4/100 — weak — probably overfit. More likely curve-fitting and luck than a durable pattern.

Why it scored 56

Here's where it breaks:

How we tested it

Five statistical tests, no mercy: out-of-sample decay (is the edge curve-fit?), Monte-Carlo robustness (is it just luck?), real cost & slippage survival, survivorship-bias exposure, and sample-size adequacy. Run on NIFTY 50 and BANKNIFTY — survivorship-free by construction, the most honest data available — across roughly two decades. Rules are read at each day's close and filled the next open, so the strategy can never peek at the bar it trades on.

56.4/100
Honesty score
87
Trades tested
49%
Win rate
NIFTY/BANKNIFTY · ~2 decades
Data

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Frequently asked

Is buying when RSI drops below 30 profitable?

On a true, survivorship-free test (56.4/100, weak — probably overfit), buying when RSI drops below 30 is weak and probably overfit. A backtest looking profitable is not the same as a strategy being real — most aren't. Test your own version free at The Honest Quant.

Does buying when RSI drops below 30 work on the NIFTY?

This verdict was computed on NIFTY 50 and BANKNIFTY index data (survivorship-free) over nearly two decades. It scored 56.4/100 — weak — probably overfit.

Is buying when RSI drops below 30 overfit?

Our overfitting test checks how much of the edge survives out-of-sample. See the full breakdown — and run your own parameters — in the lab.

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Educational, not financial advice. An honest backtest score measures whether a result survives statistical scrutiny — it does not predict future profit, and is not a buy or sell signal. · About · FAQ · All strategies