Where in this thread do you see me advocating a percentage threshold for participation?
Nowhere, which is why if one is to accept the 7% "protection" (now officially 4.7% - without the fees), he must also have endured the previous losses.
Of course, you never said it was a 7% of pure profit, but singling out this trade was, IMO, a little disingenuous.
An average of the last 50 or 100 trades would be more representative.
And what if the drop would have occurred 4 hours before it did? The first candle, which is still the bulk of the drop, could have easily occurred while the crossover was telling "buy".
Who cares? Do you think this point of contention will matter one bit in 24 hours? A week? In the long run, the method tells the same story.
Which is why I'm saying it's not a good example.
It was a trade that could look good in your trading record, but it had nothing to do with trend following, which is the only goal of your EMAs crossing technique.
Again, I'm not arguing against the technique, but rather the representation you gave by using the last drop.
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