SMA Crossover Signals Confirmed by RSI with Partial Profit Taking

Summary

This strategy combines a 20-period and 30-period simple moving average crossover with a 14-period RSI filter. A bullish crossover can trigger a long entry when RSI is above the oversold threshold of 25; a bearish crossover can trigger an exit when RSI is below the overbought threshold of 75. The strategy also offers a configurable 2% profit target, either closing the whole position or half of it.

The document describes the approach as suited to medium-term trending markets and discusses risks from whipsaws in ranging conditions, parameter sensitivity, and reliance on technical signals. It suggests adding trend-strength filters, volatility-based stops, and adaptive parameters. No backtest results are provided to support the performance claims. The source shows long entries and exits on bearish signals, but no short entries or explicit stop-loss rule; the partial take-profit option also leaves the rest of the position open until another exit condition occurs.

Key ideas

• The entry combines an upward 20/30-period SMA crossover with RSI above 25.
• A downward SMA crossover can close a long position when RSI is below 75.
• A 2% profit target can close the full position or half, depending on the setting.
• Ranging markets can produce repeated crossovers, while fixed settings may not suit every market.
• The source has no explicit stop loss and reports no backtest performance results.

Tags

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