Adaptive Moving Average Signals from Recent Candle Touches

Summary

This strategy adjusts a simple moving average period by comparing how often candles touch the current average with how often they touch averages one period longer or shorter. It selects among those periods using recent wick and body touches, then smooths the resulting line with an exponential moving average. A shift in price relative to the smoothed line and its slope defines bullish or bearish conditions and triggers entries.

The document describes the method and its proposed benefits, including noise filtering and adaptation to changing conditions, but provides no performance results. It also flags failed breakouts, reversals, and overfitting as risks, and suggests validation, walk-forward analysis, stop losses, and additional filters. The accompanying source has details that qualify the broad description: the period update uses several touch and trend conditions, is bounded, and the entries depend on trend-state changes. The published backtest settings specify BTC/USDT futures and a date range, but do not report outcomes.

Key ideas

• The method compares recent candle touches of a moving average with those of averages one period above and below it.
• The selected simple moving average is smoothed with an exponential moving average before trend conditions are evaluated.
• Entries occur when price position and the smoothed average slope indicate a change in trend.
• The document presents no backtest performance results and identifies false breakouts and overfitting as important risks.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.