Mean Reversion trades gold when it has stretched too far from its own average, betting on the snap back rather than the continuation. It needs a market that is ranging, and it is the first model to be wrong when gold trends.
What it does: Measures the stretch from a reference average and requires a defined extreme. Enters against the move, targeting the average rather than a new extreme. Uses a hard invalidation, because a stretched market can stretch further.
When it works: Balanced, rangebound gold weeks with no dominant macro driver. Asian hours, where gold often oscillates. After a spike that overshot on thin liquidity.
When it struggles: Trending regimes — the stretch simply keeps growing. Breakouts out of long compression. High-impact news, when the average is irrelevant for hours.
What the trader controls: Risk per trade, as a percentage of the account or a cash amount. Daily loss limit — once hit, no new entries for the rest of the London trading day. Maximum open positions on gold at any one time. Sessions it may trade, and whether high-impact news blocks new entries. You can switch the model off at any time, and reducing or closing risk is never blocked.
The method behind Mean Reversion is documented in full under Gold mean reversion at https://goldhunts.com/gold-strategies/gold-mean-reversion. GoldHunts publishes win rate and sample size for closed XAUUSD trades only — never profit or loss figures, and never a projection.
GoldHunts — the AI-powered gold trading operating system.