EMA and SMA Trend Breakouts Filtered by MACD

Summary

This strategy combines a 200-period EMA and a 100-period SMA with MACD conditions. A long setup requires price above both averages, a MACD fast-line cross above its signal line, and a MACD value above zero; the short setup applies the inverse conditions. Percentage-based profit targets and stop losses are configurable, with the listed defaults set to 2% profit and 1% loss for both directions. The trading logic also limits entries to a selected backtest date range.

The document presents the moving averages as trend filters and MACD as momentum confirmation, while acknowledging false crosses, whipsaws, delayed responses to reversals, and sensitivity to stop placement. It suggests parameter tuning, additional indicators, trailing exits, and position controls. The provided material does not include complete backtest settings or performance results. It also contains an inconsistency: the prose describes a MACD histogram condition, while the source code checks the MACD line against zero. These details limit what can be concluded about the strategy's effectiveness.

Key ideas

• Long entries require price above both the 200-period EMA and 100-period SMA, plus bullish MACD confirmation above zero.
• Short entries use price below both averages and bearish MACD confirmation below zero.
• The listed default profit and loss thresholds are 2% and 1%, respectively, for both directions.
• Moving-average and MACD signals can whipsaw in volatile or ranging markets and may react slowly to reversals.
• The written rules and source differ on whether the MACD histogram or MACD line is checked against zero.

Tags

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