I’ve developed a 4 EMA strategy using the following exponential moving averages: 9 EMA 20 EMA 50 EMA 100 EMA Timeframe: 1 Hour What are your thoughts on this strategy?
Lag in an EMA, which is a one-pole infinite impulse response (IIR) lowpass filter, is (N-1)/2. So: 4 days lag 9.5 days lag 24.5 days lag 49.5 days lag Try using these filters in forward-reverse mode. You'll have to look that one up. Perhaps try using these with a Kalman style gain factor to reduce lag.
My strategy is to not use indicators with these amounts of lag. I am currently testing a zero lag (or near zero lag) strategy.
Here is the thing about ALL systems, if you are the only one doing it, your ten lot NOT going to push price in direction you want it. You want to be using charting whether support/resistance or patterns, volume pushes price. SMA ok for trend.
Actually I use them, but as a lagging indicator for when I want to confirm something HAS occurred and want to take action AFTER it happens. E.g. when it is clear I want to exit, and just like setting a timer that delays the exit just a bit. But to be clear, I do not use cross overs. That compounds the lag, imo.
There is no one-size-fits-all thing. After you remove those EMAs (and all other indicators), then you can make progress.