EMA Trend Filter with RSI, Engulfing Entries, and ATR Exits

Summary

This long-only trend-following setup combines a moving-average filter, a candlestick pattern, a momentum threshold, and volatility-based exits. It requires the 100-period EMA to be above the 200-period EMA, then enters when a bullish engulfing condition occurs and RSI is above 50. The described stop is set 1.1 ATR below the average entry price, with a profit target 2 ATR above it, using a 14-period ATR by default.

The document presents the combination as a way to align entries with trend and momentum while adapting exit distances to volatility. Its published backtest settings specify BTC/USDT futures over a short historical window, but no performance statistics are supplied, so they do not establish profitability. The discussion flags lagging EMA signals, whipsaws in sideways markets, and false candlestick signals. It suggests testing parameters, adding volume or market-condition filters, and considering trailing stops. The source implements long entries and exits; it does not define a corresponding short-entry rule despite the broader trend-following framing.

Key ideas

• The strategy filters long entries with the 100-period and 200-period EMA relationship and RSI above 50.
• A bullish engulfing condition provides the entry trigger when the trend and momentum filters agree.
• The default exit distances use 1.1 ATR for the stop and 2 ATR for the target.
• The published BTC/USDT futures settings include no reported performance results, and the source defines long trades only.

Tags

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