Dual EMA Crossovers with Stop Losses and Profit Targets

Summary

This strategy uses 9-period and 21-period exponential moving average crossovers to enter long and short trades, closing on an opposite crossover. It calculates stop and target prices from the entry price, with a stated default stop distance of 0.5% and a ladder of ten profit targets from 0.5% to 5%. The default position uses 10% of account equity, and pyramiding is disabled.

The document describes the setup and its risks but provides no performance results. Although it presents the targets as a way to take profits in stages, the described implementation exits the full position at the first target, or on a reverse crossover; the other targets are plotted but do not trigger exits. The author notes that a fixed, tight stop and unfiltered crossover signals may fare poorly in volatile or ranging markets. Suggested changes include trend filters, volatility-based stops, trailing stops, and genuine partial exits.

Key ideas

• A 9-period EMA crossing above a 21-period EMA triggers a long entry, while a cross below triggers a short entry.
• The default stop is 0.5% from entry, and the ten displayed profit targets span 0.5% to 5% in the favorable direction.
• The stated trade size is 10% of account equity, with no pyramiding.
• Despite displaying ten target levels, the described exit logic uses only the first target for a full position exit.
• Crossover whipsaws and a fixed stop that may be too tight are key limitations.

Tags

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