Building a trend-following trading platform

In the previous section, we followed the steps for building a mean-reverting trading platform. The same functionality can be easily extended to incorporate any other trading strategies. In this section, we will take a look at reusing the MeanReversionTrader class to implement a trend-following trading system.

Designing the trend-following algorithm

Suppose that this time, we believe that the current market conditions exhibit a trend-following pattern, perhaps due to seasonal changes, economic projections, or government policy. As prices fluctuate, and as the short-term average price level crosses the average long-term price level by a certain threshold, we generate a buy or...