Multi-Period Moving Average Crossovers for Trend Direction

Summary

The document describes a trend-following approach using 9-, 20-, and 200-period exponential moving averages. The short pair is used to identify nearer-term direction, while the 200-period average is intended to provide a longer-term filter. Its narrative says to combine these relationships when deciding on trades. However, the included script does not implement that full description: it enters long on a 9/20 EMA crossover and enters short when price crosses below the 9-period EMA, without applying the stated 20/200 EMA filter to those entries.

A BTC/USDT futures backtest setup is provided for a one-week interval, but no results are reported. The document notes familiar limitations of moving-average signals, including lag, sensitivity to selected periods, whipsaws, and trading costs. The mismatch between the prose and code means the actual entry rules should be checked carefully before interpreting or testing the strategy. Stop losses, position sizing, and additional confirmation are suggestions for further development, not demonstrated features of the shown entries.

Key ideas

• The narrative uses a short moving-average pair for nearer-term direction and a 200-period average for long-term context.
• The included script's long entry follows a 9/20 EMA crossover.
• The shown short entry instead uses price crossing below the 9-period EMA.
• The code does not apply the narrative's stated 20/200 EMA filter to entries.
• Moving-average signals can lag, whipsaw, and incur costs from frequent trading.

Tags

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