Strategy / Momentum
Trend Following: how the bot trades.
Uses a moving-average crossover to enter with momentum and react to a change in direction.
- Suits
- Directional markets
- Fast / slow windows
- set by you
- Lot size
- set by you
- Stop-loss
- set by you
- Take-profit
- set by you
In short
What is the Trend Following strategy?
The Trend Following bot enters when a fast moving average crosses a slow one, buying a bullish cross and, if allowed, selling a bearish one, and exits on a stop, a target, a trailing stop or the opposite cross.
On Jassrox, Trend Following runs server-side on your connected MetaTrader 5 account, so your computer can be off. Like every strategy on the platform, it can lose money; test it on the demo first.
- Family
- Momentum
- Direction
- Long, short or both, set in the bot's configuration (both by default).
- Tends to suit
- Directional markets
Mechanics
How does Trend Following enter and exit?
The rules below are what the Trend Following engine does on every tick, in plain words.
Entry
How it enters
The bot keeps a fast and a slow moving average. A fresh bullish cross opens a buy, and a bearish cross opens a sell when shorts are allowed. Filters can require the averages to be clearly separated, the cross to be recent and the broader regime to agree before it enters.
Exit
How it exits
Each position has a stop-loss and take-profit, either a fixed percentage or pips, or a multiple of the instrument's Average True Range. A trailing stop can follow the best price since entry and move to breakeven once the trade is in profit. Without a trail, the opposite cross closes the position.
Market conditions
When does Trend Following fit, and when does it struggle?
No strategy suits every market. These are the conditions its rules assume, and the ones that break them.
Tends to fit
- Markets making sustained directional moves
- Volatility steady enough for ATR-based stops to make sense
Tends to struggle
- Sideways, choppy markets, where crossovers flip back and forth
- Short, sharp reversals that hit the stop before the trend resumes
- High costs relative to the size of the moves
Configuration
Which settings matter most?
Each bot can start from an AI preset, a plain-English description or manual values. These are the settings to understand before you start.
- Fast / slow windows
- The lengths of the two moving averages.
- Direction
- Long only, short only or both.
- Lot size and exposure cap
- The volume per entry and the most the bot may hold.
- Stop-loss and take-profit
- A fixed percent or pips, or ATR multiples when ATR sizing is on.
- Trailing stop
- An ATR-based trail that only tightens, with a move to breakeven.
Risk
What can go wrong with Trend Following?
Sideways markets produce repeated false signals. Costs and late entries can erase gains even when a trend is correctly identified.
- Repeated small losses in ranges are the normal cost of trend following.
- Moving averages lag, so entries and exits come after the move has started.
- Spread and slippage take a bigger share when moves are small.
In the app
How the New Bot wizard describes it
Labelled "not recommended" in the New Bot wizard: in backtests it has lost money across the markets and timeframes tested so far. It stays available for traders who want to test their own settings.
Account-wide risk limits (daily loss, weekly loss, drawdown from peak and symbol exposure) apply on top of the strategy's own exits.
FAQ
Questions about Trend Following
How does a moving-average crossover bot work?
It compares a fast and a slow moving average of price. When the fast one crosses above the slow one it buys; when it crosses below, it closes the buy or, if shorts are allowed, sells.
Why do crossover strategies lose in sideways markets?
In a range the averages cross back and forth, so the bot enters late and exits late repeatedly, paying the spread each time. Separation and regime filters reduce this but do not remove it.
Can the trend bot sell short?
Yes. Its direction setting can be long, short or both. A sell opens on a bearish cross when shorts are allowed.
Other strategies
Related
Keep exploring
Start on demo
Test the behaviour before the capital.
Start with virtual funds. Review the strategy, define your limits, and observe it before connecting a live account.
$10,000 virtual funds · No card required