The Simple Moving Average (SMA) Entry Settings allow you to control when your bot enters a trade based on whether the asset is trading above or below a chosen moving average line. This makes it easy to automate strategies that depend on trend direction.
What Is the SMA?
A Simple Moving Average (SMA) is a technical indicator that shows the average price of an asset over a set number of days.
A 50-period SMA shows the average closing price of the last 50 days.
A 200-period SMA shows the average closing price of the last 200 days.
The SMA helps traders identify long-term trends:
Above the SMA = the asset may be in an uptrend.
Below the SMA = the asset may be in a downtrend.
How the Settings Work
When creating or editing an Auto Trader, you’ll find the SMA Entry Rule under Entry Settings.
Period: The length of the SMA you want to use (e.g., 50, 100, 200). The calculation is always based on the daily chart.
Direction: Whether the bot should only enter if the asset price is above or below the selected SMA.
⚠ SMA Entry Settings are available for ETFs, Stocks, and Index Options. They do not apply to futures options. If used with a futures options Auto Trader, the SMA is based on SPY instead of the futures contract.
Example
Trend-Following Strategy
You want to only take trades in an uptrend.
Set Period = 200 and Direction = Above.
The bot will only enter trades if the asset is trading above the 200-day SMA.
Mean Reversion Strategy
You want to trade assets that are weak and trading below trend.
Set Period = 50 and Direction = Below.
The bot will only enter trades if the asset is below the 50-day SMA.
Why This Matters
Ensures trades align with your trend-based strategy.
Filters out trades that don’t fit your preferred market direction.
Allows easy automation of classic strategies like “trade only above the 200-day SMA.”
Summary
SMA Entry Rules use the daily chart for calculation.
You set a Period (e.g., 50, 100, 200) and a Direction (above or below).
Works with ETFs, Stocks, and Index Options (SPY is used for futures).
Helps automate trend-following or mean reversion strategies.