Dual Moving Average Pullbacks with a 10% Stop

Summary

The strategy uses a 200-day simple moving average to identify the broad trend and a 10-day average to identify a short-term pullback. It proposes buying when the close is above the long average but below the short average, and selling short under the inverse conditions. The document describes a 10% loss threshold and an optional lower-close condition for exits.

It suggests adding a 50-day average, volatility-based stops, or a market filter such as MACD. The intended use is medium- to long-term trending stocks, though the published backtest settings identify a short period on Binance BTC/USDT futures. No performance results are provided. There is also a mismatch between the written rules and the source excerpt: the code shown implements long entries only, and its date filter is set to always pass. The described stop and filters therefore should not be treated as validated risk controls.

Key ideas

• A long-term average provides the broad trend filter, while a short-term average is used to identify pullbacks.
• The stated long setup buys above the 200-day average when price is below the 10-day average.
• The document describes a 10% stop threshold and an optional lower-close exit condition.
• Volatility-adjusted stops and additional trend filters are suggested as possible modifications.
• The source excerpt does not implement the stated short setup or an active date filter.

Tags

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