Filtering out trades around the EMA

[Bionian]

I have noticed that a large percentage of my losses on the 5 min ES occur as whipsaws around the 20 bar EMA. If I construct a Keltner channel around the 20 EMA and adjust it to market conditions using user inputs, is it possible to filter out signals within that channel?

One thing that comes to mind is that, since all my other conditions are "all conditions are met", could I create another set with "either or", like "the price is below the lower band of the Keltner channel, or it is above the upper band"? Will adding an "either or" set 2 to a "all conditions are met" set 1 create problems?

Thanks for you help.

[NinjaTrader_PaulH]

Hello Bionian,

Thanks for your post.

I would suggest just adding the single condition to your long and short entry sets, after all you don't want to enter unless you are not in that zone.

[Bionian]

Actually, Paul, that won't work for my purposes. My strategy is a pull back and reversal strategy. As a pullback, I might restrict longs to above the moving average, but as a reversal, I need to be able to go long before the moving average, so I need to be able to trade both above and below the moving average in both directions, just not within the channel around the moving average. What do you suggest?

[NinjaTrader_PaulH]

Hello Bionian,

Thanks for your reply and clarification.

It is difficult to advise based on the information you've provided.

It sounds like you have multiple conditions that you would need to configure and include the position of price relative to the moving average for each of those. You may want to create a seperate "test" strategy where you can configure the variations and from there perhaps the way to work to your strategy sets will become clearer.