EMA Crossover Strategy Filtered by RSI and ADX

Summary

This strategy combines a fast and slow EMA crossover with RSI and ADX filters. The stated settings use 9 and 21 period EMAs, a 14 period RSI, and a 14 period ADX with a threshold of 20. Long entries require an upward EMA crossover, RSI below 60, and ADX above the threshold; downward crossovers with RSI above 40 and sufficient ADX are described as sell conditions. A risk reward ratio of 2 is specified, and the published settings identify BTC_USDT futures on daily bars from late 2019 to late 2024.

The document lists lag, repeated crossovers in ranging markets, fixed thresholds, and lack of volume confirmation as limitations. Its source code raises additional interpretive concerns: the sell condition closes a long rather than opening a short, and the exit price formulas use the position’s average price at entry, which may make initial risk distances zero or otherwise unintended. No performance metrics are reported, so the strategy’s claimed reliability is not established.

Key ideas

• EMA crossovers provide the primary entry signals, with RSI and ADX conditions acting as filters.
• The listed defaults are 9 and 21 period EMAs, a 14 period RSI, and a 14 period ADX.
• The written rules use RSI below 60 for buys and above 40 for sells, with ADX above 20.
• The source closes a long on the sell signal and its stop and target formulas may not define intended risk distances.
• The listed BTC_USDT daily backtest period is not accompanied by performance results.

Tags

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