Compared to the SPY Buy & Hold, the RSI Strategy produces $2,220 Alpha
whereas FB Buy & Hold produces ($200) Alpha, both on $10,000,
The real beauty of the RSI strategy is that for most of the timeframe that $10,000 principle can be working (on other stocks) for you while you wait for the buy signal.
The question still stands: what about 2016 makes the RSI Strategy superior in performance to FB Buy & Hold?
Luck. And hindsight. That's my best guess.
My second guess is that RSI works best in conjunction with other indicators. 30 and 70 aren't the only aspects to RSI as far as I understand. If RSI steadily stays above 40, that's also a bullish indicator, so in that sense all of 2012-16 the RSI is telling you to buy and hold. Then there are the moments where RSI's valleys move opposite the stock. I don't know. I think it's a lot of hocus pocus.
My own experiments with RSI show it's a great way to lose money during crashes and pullbacks and miss out on gains during strong bullish trends. Sometimes it's amazing how it predicts valleys and peaks right before they happen... and sometimes it's flat out wrong. With some stocks it just bleeds money. So how do you choose which stocks are appropriate to use RSI with?