Dual SMA and EMA Price-Position Breakout Strategy

Summary

This strategy compares the closing price with a simple moving average and an exponential moving average. It enters long when price is above both averages, enters short when below both, and closes positions when price lies between them. The average lengths are user-configurable; the published parameters set both to 40 and enable a candle-color filter. The described filter requires a down candle for long entries and an up candle for short entries. Backtest settings specify BTC/USDT futures at a ten-minute period over roughly one month, but no performance results are reported.

The document says combining two average types may improve signal accuracy, but gives no test evidence for that claim. Both averages lag price, and signals can reverse repeatedly in a range. The strategy has no stop-loss rule, leaving losses uncontrolled by an explicit protective exit. The source also sizes entries at 100% of equity, which makes position sizing and risk management material concerns when evaluating it.

Key ideas

• Long and short direction depends on whether price is above or below both moving averages.
• A close between the SMA and EMA triggers a flat position.
• A candle-color filter can condition entries on the direction of the current candle.
• The method can produce false signals in ranging markets and has no explicit stop loss.
• The published backtest settings include no reported performance measures.

Tags

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