Multi-SMA Trend Filtering with Pullback Entries and Swing Stops

Summary

This strategy seeks pullback entries in an established trend by combining price position, moving-average alignment, and slope checks. Long conditions require price above the 20- and 200-period SMAs, the 20-period average above the 200-period average, and both averages rising over a five-period lookback. A long signal then requires price to have been below the 20-period average on the prior bar and to close back above it. Short conditions reverse these tests. Stops use the lowest low or highest high across the prior ten periods.

The document also describes a wider set of plotted averages and presents the approach as a trend-following framework. Its published test settings cover ETH/USDT futures from January to early July 2025, but no performance statistics are included. The author identifies lag, missed pullbacks, repeated stops in ranging markets, parameter sensitivity, and the absence of volume confirmation as limitations. The source implements stop orders but no profit target, so returns and risk-reward cannot be assessed from the description alone.

Key ideas

• Trend direction is filtered using price relative to the 20- and 200-period SMAs, their ordering, and their slopes.
• A long pullback signal occurs when price returns above the 20-period SMA after closing below it.
• Swing lows and highs over ten periods define the respective long and short stop levels.
• The strategy may struggle in ranging markets and can miss pullbacks that do not reach the average.
• The stated backtest settings include no reported performance measures, and the source has no profit target.

Tags

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