Four EMA Rules for Long-Only DAX Trading

Summary

This document presents a long-only DAX strategy intended for three-minute bars. It enters when the two-period exponential moving average crosses above the four-period average, provided the 20-period average is above the 75-period average and price is above the longer average. The rules also restrict trading to a stated time window and require the 14-period average true range to exceed a threshold.

Position management combines a fixed profit target, a protective stop activated after a smaller gain, a hard loss limit expressed as a fixed euro risk, and a close near the end of the trading day. The post reports that its backtest was profitable, but supplies no performance table, test dates, transaction costs, or robustness analysis. The prose and code also differ in how clearly they describe the protective stop, so the exact intended stop behavior merits checking before implementation. The result is an example strategy specification, not evidence that it will perform similarly in live trading.

Key ideas

• The entry signal combines a fast EMA crossover with a longer-term trend filter.
• The strategy applies an ATR threshold and limits entries to a specified trading window.
• A profit target, delayed protective stop, hard loss limit, and end-of-day exit manage open positions.
• The post claims profitable backtest results but gives no supporting performance details or robustness checks.

Tags

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