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Mean Reversion Hour

Hourly breakout reversion probability (78-85% win rate)

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Mean Reversion Hour — Strategy Guide

Hourly Mean Reversion

Many markets have a specific window during the session when overextended moves are most likely to snap back. This report identifies the "mean reversion hour" — the time of day with the highest probability of price reverting to the mean after an intraday extension.

Key Metrics

Reversion Probability — The win rate of fading the hourly extreme. For ES, the late morning window typically shows 78-85% reversion rates.

Extension Zone — How far price needs to extend from VWAP before mean reversion becomes high probability. Usually 1.5-2 standard deviations.

Time to Target — How long the reversion takes. Typically 30-90 minutes to reach the VWAP or midpoint.

Trading Strategy

During the identified mean reversion window, if price is extended 1.5+ standard deviations from VWAP, fade the move. Enter toward VWAP with a stop beyond the extension extreme. Target the VWAP or session midpoint. This is a high-win-rate, small-target strategy — don't try to catch the full reversal.

Pro Tip

Mean reversion works best in positive gamma environments. Check the GEX regime before trading this strategy — if the market is below zero gamma, momentum can overcome the mean reversion tendency and the strategy will underperform.

Green & Red Days

Power Hour Breakout