Dual EMA Trend Filter with Two-Candle Countertrend Entries

Summary

The document describes a dual-EMA framework using a shorter and longer average to label upward or downward conditions. In an upward condition, two consecutive bearish candles are described as a long setup; in a downward condition, two bullish candles form a short setup. The narrative also mentions a fixed point stop, closing the opposite position as an exit, and a time-based forced close after roughly two weeks. It proposes testing average lengths and adding indicators or volatility-aware holding rules.

The supplied backtest settings specify BTC/USDT futures on an hourly chart over about a month, but no performance results are given. There is a material mismatch between the explanation and source: the code calculates and plots EMAs and colors the background, but its entry rules do not check EMA trend alignment. The prose’s stated stop is also not visibly implemented in the source, and the source exits positions through opposite entries or the time limit. Treat the described filters and risk controls as proposed logic rather than verified behavior of the supplied implementation.

Key ideas

• The narrative combines EMA-defined trend states with two consecutive candles moving against the trend for entry.
• The source calculates 10- and 30-period EMAs, but does not use their alignment in the entry conditions.
• The described fixed stop is not apparent in the supplied implementation.
• The backtest configuration provides no reported results and covers only a limited BTC/USDT futures period.

Tags

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