Dual EMA Crossover Strategy with a 15-Period SMA Trend Filter

Summary

This trend-following method uses a 15-period SMA to define market direction and crossovers between 9- and 21-period EMAs to generate candidate entries. Long trades require the faster EMA to cross above the slower one, price and both EMAs to be above the SMA, and two consecutive bullish candles. Short trades apply the corresponding bearish trend filter and crossover, with a bearish candle as confirmation.

Stops are placed at the signal candle's low for a long trade or high for a short trade, and targets are set at four times that stop distance. The document describes this as a fixed 1:4 risk-to-reward ratio and reports no measured strategy performance. Its published backtest settings use ETH/USDT on Binance with four-day bars, but no return, drawdown, or transaction-cost results are supplied. The text notes that moving-average lag and range-bound conditions can cause late or false signals, and that a fixed target may not suit every market. It suggests volatility and trend-strength filters as possible improvements rather than tested components.

Key ideas

• The 15-period SMA acts as a directional filter for 9- and 21-period EMA crossovers.
• Long entries require two bullish candles; short entries require a bearish candle and bearish alignment.
• Stops use the signal candle's extreme, with a target four times the entry-to-stop distance.
• The published backtest uses four-day ETH/USDT data, but the document gives no performance statistics.
• Lagging averages and sideways markets can produce delayed or false signals.

Tags

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