Stock Predictor trading strategy

Single Moving Trend

Single Moving Trend is the classic moving averages crossover strategy. It compares a shorter (faster) moving average of the closing price with a longer (slower) one.

Strategy group

Moving average strategies

Based on

Two simple moving averages

Typical parameters

n = 10, m = 30 days

The faster average follows the price more closely, so when it crosses the slower average the momentum of the price has changed. The strategy is designed to catch long upward trends and to stay out of long downward trends. It works best on “heavy” low-beta stocks and when market volatility is low.

Trading signals

• Buy when the n-day moving average crosses above the m-day moving average.
• Sell when the n-day moving average crosses below the m-day moving average.

Strategy rules

IF MA(n) >= MA(m)
   THEN GO LONG
   ELSE GO SHORT

Where MA(n) is the n-day moving average of the closing price and n < m.

See also: example chart and how the Moving Averages indicator is calculated.