RSI and SMA Crossover Signals with ATR-Based Exits

Summary

This one hour strategy combines RSI with fast and slow simple moving averages to create directional entries. The stated defaults are a 14 period RSI with a threshold of 50, and 10 and 21 period averages. A bullish moving average crossover is paired with RSI below the threshold for a long signal; a bearish crossover is paired with RSI above it for a short signal. ATR sets volatility-scaled exits: the stated source uses an ATR multiple for the profit distance and one ATR for the loss distance. The prose gives a profit distance of 1.5 ATR, while the parameter list identifies a risk/reward multiplier of 2, leaving some ambiguity about the effective target setting.

The document describes a BTC/USDT futures test configuration over February 2024, but supplies no performance metrics. It cautions that relaxed conditions can increase trade frequency and costs, and that choppy markets may create false signals. Parameter sensitivity and lack of a clear trend are also noted. Suggested extensions include signal filters and confirmation from other timeframes; the material presents a strategy template, not evidence of a durable edge.

Key ideas

• Long entries combine an upward SMA crossover with RSI below 50, while shorts combine a downward crossover with RSI above 50.
• The default RSI length is 14, and the fast and slow SMA lengths are 10 and 21.
• ATR scales the stop and profit distances, although the prose and parameter listing leave the target multiplier unclear.
• The stated backtest setup covers BTC/USDT futures on hourly bars during February 2024, without performance results.
• Frequent signals, sideways conditions, trading costs, and parameter sensitivity are identified as limitations.

Tags

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