Price and Moving Average Divergence Signals

Summary

This strategy compares price swing highs and lows with pivots in a weighted moving average to identify regular and hidden bullish or bearish divergences. A bullish signal occurs when price and the average make contrasting lows; bearish signals use contrasting highs. Pivot lookbacks and a bounded range between pivots determine which comparisons qualify, and the resulting conditions trigger long or short entries.

The document describes configurable averaging, price-source, pivot, and divergence-display settings, and lists a BTC/USDT futures backtest interval. It provides no performance metrics or evidence that the signals were profitable. Signals require confirmed pivots, which can limit their frequency and make them arrive after a swing has formed. The notes also warn that parameter choices can produce false signals and recommend combining divergence with other factors and risk controls; the strategy should therefore be treated as a research method rather than a demonstrated standalone system.

Key ideas

• The method compares price pivots with pivots in a weighted moving average to detect divergence.
• Regular and hidden divergence conditions can generate both long and short entries.
• Pivot lookbacks and the permitted distance between pivots affect which signals qualify.
• The document gives backtest settings but reports no performance results.
• False signals and sparse pivot events make parameter selection and added risk controls important.

Tags

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