EMA Crossover Trend Following with an RSI Filter

Summary

This strategy uses a fast and slow exponential moving average crossover to signal trend direction, with RSI relative to its own moving average as an entry filter. It takes a long position on an upward crossover when RSI is above its 26-period average, and a short position on a downward crossover when RSI is at or below that average. The documented default moving-average periods are 12 and 26, and RSI is calculated over 14 periods. The source also allows an optional stop loss, which is disabled by default.

The notes argue that the RSI filter can reduce trades in choppy markets, but provide no measured backtest results to support that claim. They warn that omitting a stop can allow losses to grow, especially during gaps, and that filtering may miss entries. The published backtest settings specify BTC/USDT futures over roughly one year, but do not include performance statistics. The description calls the averages MAs, while the source calculates EMAs; its stop-loss setting and behavior also require careful interpretation before use.

Key ideas

• The strategy enters long or short when 12-period and 26-period exponential averages cross, subject to an RSI filter.
• Long entries require RSI above its 26-period exponential average, while short entries require RSI at or below it.
• The stop loss is optional and disabled by default, leaving the strategy exposed to large adverse moves.
• The document gives backtest settings but no performance results, so it does not establish profitability.

Tags

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