Heiken Ashi Color Reversals Filtered by a 130-Period Moving Average

Summary

This strategy uses Heiken Ashi candle color changes as entry signals and a moving average as a trend filter. It buys when the calculated Heiken Ashi close moves above its open after the prior bar showed the reverse relationship, provided the market is above a 130-period simple moving average. It sells short on the opposite color change when price is below that average. The example trades two shares at market.

The author reports a simple backtest on the DAX using 15-minute bars and a one-point spread, and describes the results as encouraging without giving performance statistics. The post says other filters might improve the approach. It does not explain exits, stop placement, position sizing beyond the example quantity, or how the backtest was validated, so the available evidence is insufficient to assess robustness or live-trading performance.

Key ideas

• Heiken Ashi color reversals provide the strategy's directional entry signals.
• A 130-period simple moving average filters entries according to the prevailing trend.
• The example buys after an upward color change above the average and shorts after a downward change below it.
• The reported test used the DAX on 15-minute bars with a one-point spread.
• The post gives no performance statistics or detailed exit and risk rules.

Tags

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