Multi-EMA Trend Momentum Strategy with ATR Risk Controls

Summary

This strategy combines a five-EMA alignment with RSI and Stochastic filters to identify long or short entries. EMA ordering defines trend direction, while oscillator ranges confirm momentum and help avoid entries at extreme readings. Exit conditions can also be triggered by EMA or oscillator thresholds.

ATR sets a stop at twice its value, a target at four times its value, and a trailing offset at 1.5 times its value. Position size is calculated to risk 1% of account equity at the initial stop. The published settings describe a one-hour BTC-USDT futures backtest over roughly one month, but provide no performance results, so they do not establish profitability. The document flags whipsaws in sideways markets, slippage, indicator lag, consecutive losses, and overfitting as limitations. It also suggests volatility, time, volume, or adaptive-parameter filters, without presenting evidence that these changes improve results.

Key ideas

• Five ordered EMAs define the strategy's bullish or bearish trend state.
• RSI and Stochastic conditions filter entries and can trigger exits.
• ATR determines the initial stop, profit target, and trailing offset.
• Position size targets a 1% account-equity risk at the stop distance.
• The described backtest settings do not include performance results.

Tags

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