EMA, RSI, and MACD Confirmation for ATR Trailing Breakouts
Summary
MomentumBreakout V1.2 combines moving-average direction with momentum checks to seek breakouts in both directions. Long entries require price to cross above the fast EMA while it is above the slow EMA, with hourly RSI and MACD confirmation and price above a short simple moving average. Short entries use a cross below the slow EMA, bearish EMA alignment, and rising ATR.
Position size is derived from account equity, a risk fraction, and an ATR-based stop distance. Initial stops use an ATR multiple, then trail closer as price moves favorably; leverage is reduced as volatility rises. The rules also impose a maximum holding period and include trading fees in the stated design. The document provides strategy logic and example settings, but no performance results. It warns that choppy conditions can create repeated false signals, gaps can exceed stop levels, indicators lag, leverage magnifies losses, and fixed time exits may cut short strong trends. Its code and prose also warrant careful verification before relying on the described sizing and risk controls.
Key ideas
- EMA alignment and hourly RSI and MACD readings filter breakout entries.
- ATR sets both the initial stop distance and the position size.
- A trailing stop follows favorable price movement, while a holding-time limit forces an exit.
- Volatility-adjusted leverage, fees, and account-based risk sizing are part of the proposed framework.
- Sideways markets, gaps, lagging indicators, leverage, and parameter overfitting remain material risks.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.