Momentum MA50

[lhDT]

Hi guys,

Long time I didn't post here. I would like to share a system a friend recently show me.
The system uses two 50 period moving averages. One simple and one liner weighted. The plan is to trade when the price crossed both MA at the same time in the direction of the trend.

Long rules are :
-1. Price needs to stay below both MA for at least 3 bars, so price not touching the MA (highs or lows)
-2. Once you got your 3 bars, you know that your next trade will be a long trade
-3. Your next trade direction remains valid until you have another 3 bars trading above the MA's without touching (then u look for shorts).
-4. The signal bar is when a bar open below both MA's and closing above both MA's.
-5. You place a stop order above the signal candle high + 1pip + spread
-6. If your trade isn't triggered at the very next bar, you delete it.

Short rules are :
- Opposite for longs, except you remove the spread so 1 pip lower than the signal candle low.


Timeframe is H1.
Money management : between 0.5 to 2% per trade (I always use 0.5%)
SL/TP1 : SL at the bar low +/- 1pip, BE at 1:1, TP at 1:2
SL/TP2 : SL 30 pips, TP 60 pips
Force close when opposite signal.

Trade frequency : Between 1 & 2 per week and per pair.

I coded an for this EA has been developped, yearly results are positive, profit factor is around 1.40 and the drawdown around 15% which is a good sign.
The EA is running since yesterday on a VPS (FXCM, should change to Global Prime!), you can see the results here : https://www.myfxbook.com/portfolio/ma-ea-h1/467131
I manually tested it in ForexTester and of course, using trader discretion the profit was huge and the winnner are about 75%, overall manual profit factor is more than 2.5


The purpose of the thread is first to share but also to, as usual, fine tune it.
As you can see it is a pretty straight forward strategy, really simple, no fancy & colorful indicators everywhere, just 2 MA's and your candles.

Cheers,
Lio

[Eureka]

Thanks for presenting this. Very nice. Only problem is since it trades so infrequently, it would be hard to catch all of the trades.

Carol

[lhDT]

Thanks for presenting this. Very nice. Only problem is since it trades so infrequently, it would be hard to catch all of the trades.
Carol

That's why there is an EA. Once forward tested, will share it of course.

[Eureka]

I like it for a variety of reasons.....a very simple and easy to understand system, it uses a stop loss, DD is reasonable and the profit is VERY nice.