trading strategy based on multiple signals

Abstract

Generating a Multi-Timeframe Trading Strategy based on Three Exponential Moving Averages and a Stochastic Oscillator

This study combines a underlying depth psychology of the rationale for conservative investors' transactions, Eastern Samoa well as long-term, Sir David Alexander Cecil Low-risk strategies, and a technical analysis of the hunt for entry points into short-term, risky conjecture. A hypothesis about the latent adaptation of bad foreign-exchange-market strategies to a low-risk stock market, supported a multi-timeframe analysis of the carrefour of 3 EMA plus stochastic (a combination of three self-propelled averages and a random oscillator), is proven. The contemplate's modeling is based connected walk-forward, blind simulation, cross procedure for realistically testing a possibility that can be performed in nine steps (Colby, 2003.) Colby's algorithm Its subject is ordinary shares of Sberbank of Soviet Union, and its analysis shows an petit mal epilepsy of uncharacteristic movements in the chosen period of maximum volatility, from 2007 to the existing. This analysis was conducted for two timeframes (many than five years for the trend focus and less than three years for the entry point). For the EMA, parameters were determine at 20, 50, and 200; for random parameters were set at 14, 3, and 3, 80/20. The "failure swing" reversal pattern and new support and resistance lines were detected. The study's main conclusions are that the simultaneous consumption of three EMAs makes determining a corridor or a trend fairly honest, Eastern Samoa well equally setting stop-losses. What is more, the use of an oscillator is found not to always be well-founded; its principal undertaking is to affirm a signal. A stochastic oscillator with an explicit trend should not be analyzed for the all period under consideration—only the last values should atomic number 4 considered. Moving averages and oscillators give less put on signals on moderate-term timeframes than on short-run timeframes. Due to a alter in trend management, identifying novel (defined and correct) digest and resistance lines is found to be required.

Keywords

Algorithmic trading; Financial market; Moving averages; Stochastic; Technical indicators; Trading strategies

Presentation

Digital technologies' purpose in the modern circular economy is becoming more and more important (Berawi, 2022) . Studies rich person shown a link betwixt fundamental human values and risk perceptions, between risk perceptions and risk doings, and between risk behavior and accidents (Sutalaksana, 2022) . Therefore, an momentous task is to minimize the emotional component of production processes and, particularly, to algorithmize the search for the right trading strategies.

The development of forecast price models is one of the most active application Areas (Plotnikova, 2022) .Basic models have similar objectives, settled on minimizing overall costs and increasing the efficiency of available resources (Balashova and Gromova, 2022) .

The aim of the current work is to create a new trading scheme for the old-hat marketplace, based on well-known technical indicators. The strange commutation market is volatile; only professional traders crapper accept high risks, and their strategies aim to clearly define entry and die down points. To bring fort this study's strategy, the authors took a simple forex strategy as a cornerston and adapted it to the old-hat grocery for conservative investors. Our working hypothesis is that the trading strategy for a low-risk buy in market can be improved by adapting speculative forex strategies.

Multi-frame analysis is an judgement of a given situation from different timeframes—a skill that many market participants lack. ( Singh, 2000 ) And this lack is importantly problematic because many investors do not consider emerging graphic patterns in global trends or the impact these patterns potty have on market participants' trading decisions in other timeframes. Thus, our informative hypothesis is that adapting strategies is possible on the foundation of multi-timeframe analysis, in which a yearner timeframe determines a trend's direction and a shorter timeframe determines an optimal entry point.

Conclusion

The stochastic oscillator is a directive indicator, and EMAs are lagging indicators. The lookup for the best parameters for these indicators will take into account a balance of the market signals, which testament increment the trading strategy's effectivity. We have establish the parameters that allow for an adaptation of risky forex commercialise trading strategies to the stock exchange. First, these parameters let in two timeframes: the high timeframe is five years—for the trend management—while the lower timeframe is three geezerhood—for the entry point. Second, a combination of threesome EMAs (20, 50, and 200 time unit) advantageous random provides a main (fast) line averaging over 14 and smoothing over three periods, as well A a signal (a slow-moving average after a fast-moving average) line with a period averaging 3, with 80% overbought and 20% oversold shares. Third, combining EMAs equally a trend indicator with a random oscillator as a market speed indicator allows for the designation of patterns and the conclusion of the optimal points to open and close positions.

The specific quantitative results are two probable forecasts that indicate unique price levels at which to enter the market: (1) 80–90 rubles per apportion, and (2) 230–240 rubles per divvy up. At the moment (November 2022), the share price is 238 rubles per share, which confirms our strategy's reliability and potential for practical covering.

Discussion. A strategy's effectualness can live assessed away its ratio of true and false signals, compared with other strategies for standardised timeframes. The few false signals, the more effective the strategy. The continuation of the analyse in testing the scheme with different index number parameters to find the best combination.

The resulting forecast model is designed for a wide rate of people; information technology is comprehensible and easy to use. This set about is how a trading algorithm can be generated and programmed for machine-driven trading systems (per MetaTrader, InteractiveBrokers, and others) and developing a robo-consultant.

Acknowledgment

This enquiry was corroborated by the Theoretical Excellence Project 5-100, proposed by Saint Peter the Apostle the Great Petrograd Polytechnic University.

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TY - JOUR
T1 - Generating a Multi-Timeframe Trading Strategy based on Three Exponential Moving Averages and a Random Oscillator
AU - Lyukevich Igor Nickolaevich,Rodionov Dmitry Grigorievich,Gorbatenko Irina Igorevna
JO - International Journal of Technology
VL - 11
IS - 6
SP - 291
EP - 319
PY - 2022
DA - 2022/12/07
SN - 2087-2100
DO - https://doi.org/10.14716/ijtech.v11i6.4445
UR - https://ijtech.eng.ui.ac.ID/article/catch/4445