Combining Moving Averages and Momentum Signals for Trend Following

Summary

This strategy combines price position relative to six EMA and SMA periods with RSI, Stochastic, CCI, momentum, and MACD signals on a one-hour timeframe. It counts bullish and bearish readings and uses their difference to trigger long or short entries and to close positions when the signal moves past separate exit thresholds. The published parameter defaults set entry thresholds at 12 and -12, and exit thresholds at -9 and 9.

The document describes the method and its intended rationale, but supplies no performance results. It warns that lagging indicators can delay decisions, conflicting signals in sideways markets can increase trading, and the thresholds may be sensitive to tuning. The strategy has no explicit stop loss and uses technical indicators without fundamental context. Suggested extensions include volatility-based stops, trend filters, adaptive thresholds, and position sizing based on signal strength.

Key ideas

• The strategy counts signals from moving averages and several momentum or oscillator indicators.
• The difference between bearish and bullish counts drives entries and exits at configurable thresholds.
• The published defaults use entry thresholds of 12 and -12 and exit thresholds of -9 and 9.
• Lag, sideways-market whipsaws, threshold sensitivity, and the lack of a stop loss are stated limitations.

Tags

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