Triple Moving Average Trend Filters with Pin Bar Entries and Dynamic Risk

Summary

This strategy combines a three-average trend filter with Pin Bar entries in the direction of the prevailing trend. The bullish alignment places a fast EMA above a medium EMA and a slow SMA; bearish alignment reverses that order. A qualifying Pin Bar is defined by a wick exceeding 66% of the candle’s total range. Signals use completed candle data and are delayed by one bar, while entries are placed as stop orders around the confirmed candle’s high or low.

Risk sizing is described as equity multiplied by a user risk percentage and leverage, divided by the distance to an ATR-based stop. The system also includes trailing exits, cancels stale entry orders, closes positions on Friday, and exits when the fast and medium averages cross against the position. The document presents configurable leverage and risk controls but offers no backtest results to validate performance. It warns that ranging markets can cause repeated losses, that high leverage amplifies account risk, and that tuning many parameters creates overfitting concerns. The approach is therefore most dependent on sustained trends and careful validation across markets and timeframes.

Key ideas

• The trend filter requires the fast EMA, medium EMA, and slow SMA to align in order before taking directional signals.
• Pin Bar entries require a wick greater than 66% of the candle’s range and are confirmed with a one-bar delay.
• Position size is based on equity risk, leverage, and the distance to an ATR-based stop.
• Trailing exits, stale-order cancellation, Friday closures, and EMA cross exits add risk controls.
• Range-bound markets, high leverage, and extensive parameter tuning are identified as risks.

Tags

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