Hull MA System

Start with 16 or 20 period HMA for daily charts. This is the original recommendation and provides good balance between responsiveness and reliability for swing trading.

HMA doesn't predict - it responds faster to price changes due to its formula. By using weighted averages and a square root smoothing period, it reduces lag so much that it appears to anticipate moves.

HMA has less lag than EMA or SMA, which can give earlier signals. However, this also means more false signals in ranging markets. It's 'different' rather than universally 'better' - choose based on your trading style.

Yes, HMA-based trading is suitable for TFSA accounts. The strategy typically involves moderate frequency trading appropriate for registered accounts.

Color change (typically red to green or vice versa) indicates the HMA has changed direction. Green usually means rising (bullish), red means falling (bearish). This is your primary trading signal.

Use filters: 1) Only trade in direction of longer-term HMA (55 period), 2) Add ADX > 20 requirement (trending market), 3) Wait for 1-2 bar confirmation after turn, 4) Use higher timeframe alignment.

Common combinations: 9/21 (responsive), 14/28 (balanced), or 20/50 (smoother). For additional filtering, add a third longer-term HMA (55 or 100). Choose based on your timeframe and preference.

Aggressive: Enter on HMA turn. Conservative: Wait 1-2 bars for confirmation. Best: Enter on turn when higher timeframe already aligned - combines early entry with confirmation.

Trail your stop below the HMA (for longs) with a small buffer. As HMA rises, move stop up. Don't move stop above the HMA until you want to lock in profits at that level.

Yes, use shorter periods (9-14) on shorter timeframes (5-min to 1-hour). Be aware that whipsaws increase significantly intraday. Use additional filters and tighter risk management.

Scan for: HMA direction change in last 1-2 bars, price above HMA, longer-term HMA aligned, optionally RSI and volume filters. Rank by HMA slope strength and timeframe alignment.

Calculate HMA slope: Slope = (HMA[0] - HMA[5]) / 5. Normalize by dividing by price and multiplying by 100. Track slope changes and divergences for additional signals.

Adaptive Period = Base Period × (Current ATR / Average ATR). This increases period during high volatility (filters noise) and decreases during low volatility (maintains responsiveness).

Calculate: HMA Momentum = Price - HMA, or HMA - HMA's own MA. Plot as oscillator. Signals: zero crosses, divergences from price, and extreme readings.

Well-designed HMA systems typically achieve 45-55% win rates. Profitability comes from cutting losses quickly on false signals and letting winners run with trailing stops. Focus on risk/reward ratio over win rate.