Moving Average Crossover Entries with a Moving Average Exit
Summary
This long-only trend-following strategy enters when a short-period moving average crosses above a longer-period average. It exits when the closing price crosses below a separate exit average. Traders can select periods and smoothing methods for the entry and exit averages; the source calculates them from a price series based on each bar's high, low, and close. The document also describes possible filters, such as volume or volatility, and a trailing stop as potential extensions.
The source and published settings specify a BTC/USDT futures backtest window, but the document gives no performance results. It cautions that crossovers can produce false signals in sideways markets, that parameter choices affect trade timing, and that failed breakouts or poorly placed stops can cause losses. Although the overview mentions a stop mechanism, the supplied logic closes on an exit-average cross and does not show a separate stop order. The strategy's described trend benefits therefore remain unverified by the information provided.
Key ideas
- A bullish crossover of the short and long moving averages triggers a long entry.
- A close crossing below a separate exit moving average closes the position.
- The periods and smoothing methods for the averages are configurable.
- Sideways conditions can generate false signals, and the document gives no backtest performance results.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.