EMA Crossover Entries with RSI Filters and ATR-Based Exits
Summary
This rules-based strategy uses a fast and slow EMA crossover to choose direction, with RSI filtering some entries: longs require RSI below 70, while shorts require it above 30. It sets stop-loss and take-profit levels using ATR, placing the stop 1.5 ATR from the average entry price and the target 3 ATR away. The stated default indicator periods are 20 and 50 for the EMAs and 14 for both RSI and ATR. The document describes this setup as most suited to markets with clear trends.
The supplied backtest configuration concerns BTC/USDT futures over approximately one year, but the document gives no performance metrics, so it offers no evidence that the system was profitable or robust. Its caveats include repeated false crossovers in sideways markets, missed trades when RSI remains extreme during strong trends, and insufficient protection during sudden volatility spikes. It also points out that position sizing is not defined and that parameter selection warrants testing.
Key ideas
- A fast EMA crossing a slow EMA sets the long or short direction.
- RSI filters longs above 70 and shorts below 30.
- ATR sets a stop at 1.5 times its value and a target at 3 times its value from entry.
- Sideways markets, persistent RSI extremes, volatility spikes, and missing position sizing are limitations.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.