Dual SMA Crossover Trend Strategy with Fixed Percentage Exits

Summary

This strategy uses a fast and slow simple moving average crossover to enter long or short positions. The stated defaults are 10 and 30 periods. Each position receives a take-profit target and stop-loss set as fixed percentages of its entry price, while position sizing is based on a percentage of equity. The document also describes chart markings and alert conditions.

It provides no performance results. It warns that crossovers can whipsaw in ranging markets, react late to reversals, and generate excessive trades. Fixed exit distances may not suit different volatility conditions, and the source does not account for fees or slippage. Suggested refinements include volatility-based exits, trend and volume filters, broader risk controls, and testing parameters across markets and timeframes. These are proposals rather than validated improvements; the document recommends backtesting and forward validation before practical use.

Key ideas

• A fast SMA crossing above or below a slow SMA triggers long or short entries.
• The stated default SMA lengths are 10 and 30 periods.
• Take-profit and stop-loss levels are fixed percentages of the entry price.
• Crossover signals may lag and can cause repeated losses in range-bound markets.
• The described logic does not include trading fees or slippage in its backtest setup.

Tags

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