Captures medium to long-term trends using EMA crossovers
| Strategy Type | Trend Following Moving Average System |
| Market Outlook | Captures medium to long-term trends using EMA crossovers |
| Risk Profile | Low to Moderate - Clear signals with defined entry/exit rules |
| Reward Profile | 1:2 to 1:5 on trending moves; Captures 60-80% of major trends |
| Time Horizon | Swing trading (1-4 weeks) to Positional (1-6 months) |
| Capital Requirement | $15,000 - $75,000 for meaningful position |
| Margin Type | Cash account for shares; Reg-T margin or defined-risk options for leverage |
| Best Used When | ACN in clear trending phase; Avoid during range-bound markets |
| Nyse Applicability | ACN ideal for EMA crossover due to deep institutional ownership creating sustained trends; Clean price action with minimal overnight gaps; IT-services bellwether with strong technology-sector correlation |
| Sec Compliance | Fully compliant standard technical analysis strategy under SEC/FINRA framework |
| Lot Sizes | Single-stock futures unavailable to US retail; obtain leverage via options or Reg-T margin • 100 shares per contract (standard US listed option); ~$35,000 notional at $350 • No lot restriction, typically 25-200 shares; fractional shares available at many brokers |
| Trading Hours | 9:30 AM - 4:00 PM ET; EMA signals on daily close (4:00 PM) |
| Expiry Considerations | Monthly options expire 3rd Friday; weeklies expire each Friday; roll positional options 7-10 days before expiry |
| Tax Implications | Shares held >1 year: 0/15/20% LTCG; <1 year: ordinary income rates (up to 37%); Equity options: short-term unless held >1 year; Wash-sale rule applies |
9 and 21 are Fibonacci numbers widely followed by traders, creating self-fulfilling support/resistance. They represent roughly 2 weeks and 1 month of trading, capturing short and medium-term trends.
Wait for daily close to confirm crossover. Enter at next day's open. Intraday crossovers often reverse by close, so patience prevents false signals.
Skip signals if 3+ crossovers occurred in last 20 days. Check EMA separation (need 1%+ gap). Use ADX filter (>20). Accept some whipsaws as part of the strategy.
EMA crossover typically wins 45-55% of trades. Profitability comes from winners being 2-3x larger than losers, not from high win rate.
Yes, but 9/21 is well-tested for ACN. Avoid over-optimizing. If changing, test nearby values (8/20, 10/22) - results should be similar for robustness.
Use weekly for direction (only trade aligned with weekly trend), daily for signals (9/21 crossover), hourly for entry timing (pullback opportunities).
After Golden Cross, wait for price to pull back to 9 or 21 EMA. Enter on bounce (bullish candle). Better price and tighter stop than chasing crossover.
Crossover day volume > 1.2x average (RVOL > 1.2) confirms signal. A close in the upper third of the range (RVOL > 1.5) indicates institutional buying. Low volume crossovers are weak - reduce size or skip.
Add 50 EMA as trend filter. Only take golden crosses when price is above 50 EMA and 50 EMA is sloping up. Adds trend context, reduces counter-trend trades.
Reduce position 50% before results or buy protective put. After results, assess gap and decide to add back or exit. Don't hold full size through uncertainty.
Test fast 5-13, slow 15-34 with 70/30 in-sample/out-of-sample split. Require <20% degradation. Test nearby parameters for stability. Standard 9/21 often near-optimal.
Standard 9/21 is most robust. KAMA works well in choppy periods. Hull MA for more responsive trading. Avoid TEMA (too many whipsaws). Test before switching.
ITM calls (delta 0.75+) for trend following. Bull call spreads for defined risk. LEAPS for weekly signals. Calendar spreads for established trends. 45+ DTE minimum.
Track: Win rate (45-55%), Win/Loss ratio (2-3x), Profit Factor (>1.5), Sharpe (>1.0), Max DD (<15%). Compare to ACN buy-hold. Monthly review, quarterly optimization.
Cap ACN at 15% of portfolio. Total IT-services EMA exposure max 20%. Don't double up correlated stocks (ACN-CTSH). Track total directional exposure. Diversify across sectors.
Full guided lessons, quizzes, and a complete strategy library for the United States market. One-time purchase. No subscription, ever.
Get United States access →