Weekly EMA Crossover and RSI Strategy with Risk Controls

Summary

This strategy combines a 9-week and 21-week exponential moving average crossover with a 14-week relative strength index threshold. It opens a long position when the faster average crosses above the slower one and RSI is above 50. It exits if the averages cross downward or RSI falls below 50. The proposed trade controls include risking 2% of account equity, a 5% stop loss, a 10% profit target, and a 3% trailing stop.

The document describes the rules and possible adjustments, but supplies no performance results to show whether they work. It notes that moving average crossovers can be noisy, RSI can give false signals, costs are excluded, and several parameters may need testing. It suggests trying different indicator settings and adding confirmation filters or fundamental context. The published test configuration uses a brief period of futures data with three-hour bars, so it does not establish how the stated weekly rules perform over longer samples or other markets. The code also leaves the stated risk sizing unclear in its implementation.

Key ideas

• A long entry requires the 9-week EMA to cross above the 21-week EMA while the 14-week RSI is above 50.
• The position exits when the averages cross downward or RSI falls below 50.
• The proposed controls are 2% account risk, a 5% stop, a 10% target, and a 3% trailing stop.
• The strategy may generate noisy or false signals and does not account for trading costs.
• The short test configuration does not provide evidence of long-term performance.

Tags

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