Moving average trading strategy with three exits — the simplest complete one

The simplest complete moving average trading strategy: one entry condition and three ways out. If you have never written a trading strategy before, start here rather than with something clever. It does one thing, and it has every required part.

1. The rule

# BUY — price above a moving average if Price > Sma(60): Buy()# SELL — take profit, stop loss, time exit if ProfitPct >= 2.0 or ProfitPct <= -1.0 or HoldTime >= 900: Sell() You do not need a re-entry guard line here. With split buy count at 1 — the default — the engine does not evaluate the BUY block at all while you hold a position, so the condition staying true cannot stack another entry on top. Spend that attention on the exit instead. The numbers are placeholders; the structure is the point.

2. Why this is the baseline

Every element here is required, not optional. That last one is the part beginners leave out and it costs the most, because it is invisible. A position that neither wins nor loses is still occupying capacity you could have used. Anything more complicated you write later has to beat this. Most of the time it will not.

3. When it fails

Price > Sma(60) is true for as long as price stays above the average, so this enters on the hundredth tick as readily as the first. It has no concept of a crossing — see moving average crossover strategy with a real crossing test for the version that does. It will also enter on names with no liquidity and no volume, because nothing here looks at either.

4. What the round trip asks of it

The 2.0% target against a 1.0% stop needs a 33% win rate on paper. With our measured round trip of about 0.75% it needs 58%. That 25-point gap is the single most useful number for a beginner to internalise, because it does not depend on your entry being clever. It applies to every strategy on this site. It is also why a 2% target survives contact with reality and a 0.5% target usually does not: the cost is fixed, so the bigger the target, the smaller the share it takes.

5. What to change first

Add one condition at a time and record the trade count each time. Liquidity first (DayAmount > 5000000), then a spread check, then the crossing form of the entry. If a change improves the result and cuts trade count by ninety percent, you have not improved the strategy — you have made it rarer, and you have far less evidence than you had before. Run each version against your own recordings: how to backtest a day trading strategy on US stocks.