1、What are Dual Moving Averages?
The moving average is a widely used technical indicator that is often combined with time series data. Its purpose is to smooth out short-term fluctuations and highlight long-term cycles and trends. Over the years, various types of moving averages have emerged, including simple moving averages, exponential moving averages, weighted moving averages, and cumulative moving averages. The dual moving average strategy primarily utilizes the simple moving average.
We can calculate the moving average of each trading day based on the closing price of the previous N days. By connecting these calculated points, we form a line known as the N-day moving average line. Dual moving averages involve calculating two different moving average lines based on different periods, such as a 5-day moving average and a 60-day moving average.
2、What is RSI?
The Relative Strength Index (RSI) is an indicator used to analyze the intent and strength of buying and selling pressure in the market by comparing the average closing gains and losses over a certain period. It helps predict future market trends and reflects the market's level of activity over a specific timeframe.
3、Dual Moving Average-RSI Strategy
The Dual Moving Average-RSI strategy utilizes two moving average lines with different periods and the RSI algorithm to determine the timing for buying and selling. When the short-term moving average crosses above the long-term moving average and the RSI value is greater than or equal to the threshold +50, it triggers a long position. Conversely, when the short-term moving average crosses below the long-term moving average or the RSI value is less than or equal to the threshold -50, the strategy will close the position.
Set the RSI threshold to 10 as shown in the following chart, and refer to the arrows for entry and exit points.
4、Create a backtest and confirm the optimal strategy parameters.
Before creating a live trading strategy, you can perform a backtest first. Fill in the expected parameters, click on the backtest, and the system will automatically backtest the data (default within one month). A reference backtest record will be generated in the backtest history, which users can analyze. Based on the backtest data, users can select the optimal parameters for the live trading strategy.
5、Create a live trading strategy, and run the strategy.
6、Parameter Explanation
Strategy Name: The strategy name can be customized.
SL Ratio: When the investment amount's loss ratio exceeds the set auto stop loss ratio, the strategy will be automatically terminated.
Absolute Profit: When the indicator meets the sell conditions, the spot price must be higher than the average holding price to execute the sell order; otherwise, it continues to hold.
Balance: Refers to the available balance in the wallet.
Total Investment: The amount invested in this strategy.
Fast Window: Parameter 1 for calculating the SMA indicator, representing the short period.
Slow Window: Parameter 2 for calculating the SMA indicator, representing the long period.
RSI Period: Parameter for calculating the RSI indicator.
RSI Threshold: Must be greater than 0 or less than 50.
Period: The K-line period used for strategy execution.
Order Quantity: If left blank by default, the order quantity is dynamically calculated based on the market price and investment amount. If a specific value is chosen, it will be used instead. If the calculated quantity exceeds the user's set value, the user's value will be used; otherwise, the dynamically calculated value will be used.
