This trading strategy is quite simple, only needing 2 exponential moving averages: the 9 EMA and the 21 EMA. When the fast (9) EMA crosses over the slow (21) EMA, that’s our indication to enter long. The exit criteria is when the fast EMA crosses under the slow EMA. If shorting, just do everything opposite: enter short on the cross under and exit on the cross over.
9/21 EMA crossover strategy for the SPY on 15min timeframe
Results
Testing this strategy on the SPY has returned the following profit factors:
- 1min: 1.082
- 5min: 1.208
- 15min: 1.262
- 30min: 1.116
- 1hour: 1.069
- 4hour: 0.886
- 1day: 0.947
- Average: 1.081
This strategy works great on shorter timeframes such as the 5min and 15min. Remember, different ticker symbols can provide different results.
TradingView Script
Try the EMA crossover strategy for yourself on TradingView: https://www.tradingview.com/script/1MJBcBPJ-9-21-EMA-Crossover-backtestx/
Test with your own tickers and timeframes to see how well it works!