A Short and Medium Moving Average Crossover System
Summary
This long only trend following system buys when a 7 period simple moving average crosses above a 10 period average and closes the position when the shorter average crosses below. It also calculates 100 and 200 period averages as chart references, but the source does not use them to filter entries. The document presents crossovers as a straightforward way to track changes in short to medium term momentum and marks signals on the chart.
No strategy performance results are supplied. The document notes that moving averages lag price, can generate repeated false signals in sideways markets, and that the implementation has no explicit stop loss, volume confirmation, or volatility based position sizing. It proposes trend filters, stops, parameter testing, and additional indicators as possible extensions. The published test settings name TRUMP_USDT futures on an hourly chart, but they do not provide return or drawdown evidence; the broad claims about trend capture should therefore be treated as rationale rather than demonstrated results.
Key ideas
- A buy occurs when the 7 period simple moving average crosses above the 10 period average.
- A downward crossover closes the long position; the system does not open a short trade.
- The 100 and 200 period averages are plotted but do not affect the source’s trading rules.
- Lag and repeated crossovers in sideways markets can create late entries and trading costs.
- The implementation lacks explicit stop loss and dynamic position sizing rules.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.