EMA Alignment and DMI Filters for Long-Only Trend Entries

Summary

This open-source strategy seeks long entries when price and four exponential moving averages form a bullish ordering: price above the 9-period EMA, followed by the 9-, 20-, 50-, and 200-period averages in descending order. It also requires ADX to exceed a minimum and positive directional movement to be stronger than negative directional movement. Further filters check that the 20-period EMA is rising, five-period rate of change is positive, and that rate of change is accelerating. The strategy permits no pyramiding and only enters while flat.

An open position is closed if price falls below the 9-period EMA, the 9-period EMA slips under the 20-period EMA, directional movement turns negative, ADX falls below its threshold, or rate of change becomes negative. The script includes configurable plots and signal display options. The supplied excerpt is truncated, and it contains no instrument, backtest period, performance statistics, or discussion of costs and risk controls. Its conditions describe a rule set, not evidence that the filters improve returns.

Key ideas

• A bullish ordering of price and the 9-, 20-, 50-, and 200-period EMAs is required for entry.
• ADX and the relative strength of positive versus negative directional movement filter trend strength.
• A rising 20-period EMA, positive rate of change, and positive acceleration add momentum conditions.
• The strategy holds at most one long position and exits when price, EMA, DMI, ADX, or force conditions weaken.
• The excerpt supplies no backtest evidence or explicit position-sizing and stop-loss framework.

Tags

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