A Daily EUR/USD Harami Strategy with a 50-Day Moving Average
Summary
The strategy applies a daily Harami-style candle pattern to EUR/USD, defined here as a bar whose high is below the previous bar’s high and whose low is above the previous bar’s low. A bearish candle above the 50-day moving average triggers a long entry at the next day’s open; a bullish candle below the average triggers a short entry. Positions are closed after one bar, regardless of subsequent price action. The stated position size is 15 shares, and the rules disallow cumulative orders.
The author calls the strategy profitable but supplies no test results, sample period, cost assumptions, or risk statistics to support that claim. A specific caveat is that Sunday candles must be excluded because including the short Sunday session with Monday can distort the test. The document presents a simple rule set and flags a data-handling sensitivity, while also acknowledging that the approach needs refinement; it does not establish robust out-of-sample performance.
Key ideas
- A Harami is defined as a daily bar contained within the prior bar’s high-low range.
- A bearish pattern above the 50-day moving average triggers a long entry at the next open.
- A bullish pattern below the moving average triggers a short entry at the next open.
- The strategy exits after one bar without conditioning on the trade’s outcome.
- Including Sunday candles can distort the reported EUR/USD test, and no supporting performance data is provided.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.