Guide

Trading strategies explained, with rules you can backtest.

Eight classic strategies, what each one is good and bad at, and how to test any strategy on real data before risking money.

Eight classic strategies, with their exact rules

These are well-known, fully mechanical strategies. Inside Genni Strategies each one is backtested on the last 30 days of real candles and ranked on a live leaderboard, fees included, so you can see what is working now.

Trend following · long

EMA 9/21 Crossover

The rules: Buy when the fast EMA crosses above the slow one; sell on the cross back.

Honest view: Works when the market trends cleanly. Expect a string of small losses in sideways markets; the 3% stop keeps each one limited.

Full rules, strengths and weaknesses

Long-term trend · long

Golden Cross 50/200

The rules: The classic long-term trend signal: SMA 50 crossing above SMA 200.

Honest view: Very few trades and late entries, but it keeps you on the right side of the big moves.

Full rules, strengths and weaknesses

Mean reversion · long

RSI Oversold Bounce

The rules: Buy when RSI climbs back above 30; take 4% or stop at 2%.

Honest view: Buys fear. It wins often in ranges and uptrends, and loses when a real downtrend keeps falling.

Full rules, strengths and weaknesses

Trend + momentum · long

MACD Trend Momentum

The rules: MACD crosses up while price is above the 200 EMA; exit on the cross down.

Honest view: The 200 EMA filter removes most counter-trend trades, which is where MACD crossovers usually fail.

Full rules, strengths and weaknesses

Trend following · long

SuperTrend Follow

The rules: Ride the SuperTrend: in when price crosses above it, out when it crosses below.

Honest view: One line decides everything, so it is easy to follow. It gives back profit at each reversal.

Full rules, strengths and weaknesses

Mean reversion · long

Bollinger Bounce

The rules: Buy the bounce off the lower band; exit at the middle band.

Honest view: Best in quiet, range-bound markets. A strong trend walks down the lower band and stops it out.

Full rules, strengths and weaknesses

Breakout · long

Donchian 20 Breakout

The rules: Buy a close above the previous 20-candle high; exit below the 10-candle low.

Honest view: The idea behind the Turtle traders: most breakouts fail, but the few that run pay for the rest.

Full rules, strengths and weaknesses

Mean reversion (short) · short

RSI Overbought Short

The rules: Short when RSI drops back below 70; take 3% or stop at 2%.

Honest view: Sells strength. Dangerous in bull markets, where overbought can stay overbought.

Full rules, strengths and weaknesses

How to find a strategy that suits you

1. Write the rules down

Entry, exit, stop and size, with no room for "it depends". If a rule cannot be written, it cannot be tested.

2. Backtest on real data

Run the rules over past candles. Look at profit factor, the worst drawdown and the number of trades, not just the total return.

3. Paper trade, then go small

Follow it live without money first. If it behaves like the backtest, start with a size whose losses you will not notice.

Questions

Frequently asked questions

What is the best trading strategy?
No strategy is best in every market. Trend-following rules make money when prices trend and lose in ranges; mean-reversion rules do the opposite. The best strategy for you is one you have tested on real data, whose losing streaks you can sit through, with a fixed risk per trade.
What is backtesting?
Backtesting runs a strategy's rules over past prices to see how it would have done: the number of trades, win rate, profit factor and the worst drop (drawdown). It cannot promise future results, but a strategy that failed in the past has little reason to work later.
What is a good win rate?
Win rate alone says little. A strategy that wins 35% of the time can be very profitable if its winners are three times its losers, and a 70% win rate can still lose money. Look at profit factor (total won divided by total lost; above 1.3 is decent) and maximum drawdown.
How much should I risk per trade?
Many traders risk 1% or less of their account on each trade, so that a run of ten losses is survivable. Set the stop first, then size the position from it.
Can I test my own strategy for free?
Yes. Genni Strategies lets you build rules without code, or import a TradingView Pine Script strategy, and backtest it on up to 1,000 real candles. Paper trading lets you follow it live with no money at risk.

This page is education, not investment advice. Trading involves substantial risk of loss. Read next: Trading indicators · Trading strategies · Candlestick patterns