Triple Simple Moving Average Alignment for Trend-Following Trades

Summary

This strategy uses three simple moving averages to represent short-, medium-, and long-term direction. It enters long when the fast, middle, and slow averages are aligned from highest to lowest, and enters short when the ordering is reversed. A configurable delay requires the alignment to persist for several bars before entry, and the strategy closes a position when the opposite alignment condition appears. The published example uses 20-, 50-, and 200-period averages, with a five-bar delay for either direction.

The method is straightforward and configurable, but moving-average alignment is inherently delayed and can miss early parts of a move. The document also notes that longer holding periods can increase exposure to losses and overnight risk, while unsuitable parameters may produce weak signals. A BTC/USDT futures test interval is listed, but no returns or other performance evidence are reported. Suggested refinements include testing average periods and delay settings across products, adding stop rules, and evaluating re-entry or scaling approaches.

Key ideas

• Three moving averages define short-, medium-, and long-term trend alignment.
• The strategy enters in the direction of full bullish or bearish ordering after a configurable delay.
• An opposite alignment serves as the stated position exit condition.
• Crossovers can lag, and long holding periods add loss and overnight exposure risks.
• The listed futures backtest settings do not include reported performance results.

Tags

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