Backtest: When EQT closes 5% below its 20-day simple moving average while Brent crude i...
What happens when a stock’s sharp dive contradicts a bullish signal in its own sector? That is the assumption behind this test: EQT closes 5% below its 20-day moving average while Brent crude sits above its 50-day — a panic move that should mean-revert. The strategy buys at the close and holds for a bounce.
The simulation ran 11 trades on $100,000 and returned 13.15% overall. That sounds fine until you check the alternative: SPY gained 68.30% over the same period. The edge was real but small, and the benchmark crushed it by about 55 points. Whether the pattern is tradable depends on how you weigh a positive return against opportunity cost.
The full backtest breaks down win rate, per-trade extremes, and the exact logic bar by bar. All evidence is below.
When EQT closes 5% below its 20-day simple moving average while Brent crude is above its 50-day simple moving average, buy at close; exit when EQT closes above the 20-day moving average or after 10 trading days, whichever comes first. EQT's steep dips while crude signals sector strength are panic moves that mean-revert, offering a high-probability bounce.
How this was measured
This is a simulated backtest generated from the plain-English strategy below, executed bar-by-bar on historical market data using the price + news data mode with $100,000 starting capital. Strategy: When EQT closes 5% below its 20-day simple moving average while Brent crude is above its 50-day simple moving average, buy at close; exit when EQT closes above the 20-day moving average or after 10 trading days, whichever comes first. EQT's steep dips while crude signals sector strength are panic moves that mean-revert, offering a high-probability bounce.
The key numbers
The charts
The takeaway
The strategy returned +13.15% on $100,000 starting capital across 11 closed trades with a 45% win rate. Over the same window SPY buy-and-hold returned +68.30%, so the strategy finished trailing the benchmark by 55.15 points. Best single trade +10.45%, worst -6.93%.
The fine print
- Simulated results on historical data — fills, slippage and costs are idealized.
- Past performance does not predict future results.