The idea is that price doesn't move away from its average forever — when an asset stretches far above or below its recent mean, the odds favor it snapping back. In the IADSS demo, this is the model James (InvestAnswers) says he'd trade standalone ("everything mean reverts"), and it's also the confirmation layer for the other models.

How it's measured

The indicator converts price into a z-score: how many standard deviations the current price is from its moving average.