Mini S&P 500 Reversal Entries with Moving Average Trend Filters
Summary
This educational system uses moving averages to define a trend filter and short term reference levels for long and short trades on the mini S&P 500. For a long entry, price must be above a rising 125 period average while remaining below a 14 period average; the position exits after price rises above that shorter average and closes higher than the previous bar. The short side mirrors the direction: price is below a falling 125 period average and above a 4 period average, with exit after price moves below that average and declines from the prior bar.
The rules combine a longer term directional filter with shorter term pullback conditions, aiming to trade in the direction of the broader trend. The source calls the approach mean reverting, but provides no backtest, performance measures, bar interval, or execution assumptions to assess that characterization. It explicitly leaves protective stops and profit targets to be added, so the listed entries and exits do not define complete risk controls or demonstrate profitability.
Key ideas
- A 125 period moving average and its slope define the directional trend filter.
- Long entries require price above the trend average but below a shorter average.
- Short entries require price below the trend average but above a shorter average.
- Positions exit when price crosses the short term average with confirming movement.
- Stops and profit targets are left unspecified, and no performance evidence is reported.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.