Dual Moving Average Crossover Strategy with Trailing Stops

Summary

The document describes a long and short strategy that uses crossovers between 20-day and 60-day exponential moving averages to infer trend direction. It proposes entering long when the shorter average crosses above the longer one and short when it crosses below. Positions use trailing stops tied to recent price extremes, with a stated 3% distance, and the stop is adjusted while the position remains open.

The note recommends filters for unclear trends, tuning the average periods and stop distance, and managing position size. It warns that sideways markets can cause repeated crossovers and losses, while unsuitable parameters, stop settings, and trading costs can weaken results. No performance evidence is provided. The accompanying source code is titled and structured as a bands scalper, using price channels, body size, and trend state rather than the described dual moving average crossover. Its parameters and brief BTC futures backtest settings do not establish that the written strategy was tested, so the claimed stability and profit potential remain unsupported.

Key ideas

• The written method enters long or short when the short and long exponential moving averages cross.
• It specifies 20-day and 60-day averages and describes a trailing stop based on price extremes at a 3% distance.
• Repeated crossovers in unclear trends can increase trading frequency and losses.
• The note suggests adding trend filters, tuning parameters, and adjusting position size.
• The supplied source describes a bands based scalper, so it does not verify the written strategy.

Tags

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