The name is arithmetic, not a claim about odds. The 50-50 strategy takes its two conditions from the 50-day moving average and the 50 level on the Relative Strength Index, and both have to hold before a pullback counts as a setup.
What the 50-50 strategy is
The 50-day moving average is the mean of the last 50 daily closes, which is about ten trading weeks of price history. The RSI is a momentum oscillator on a 0 to 100 scale. Its midpoint has a precise meaning: the reading sits at 50 when the average gain and the average loss across the look-back are equal. Above 50, average gains over the window exceeded average losses. That is all a reading above 50 says, and it is enough for the test this strategy runs.
This strategy uses a 20-period RSI rather than the conventional 14 (Investopedia, "Relative Strength Index (RSI)", read 2026-09-12, gives 14 as the standard look-back). Twenty is this strategy's parameter. A longer window moves more slowly and crosses 50 less often.
The setup is a pullback inside an uptrend that is already established, rather than a turn at a low. The conditions below define "established" and "pullback" so neither has to be judged on the day.
The entry conditions
- The 50-day MA is above the 200-day MA. This is the precondition, sometimes called a golden cross. Where the 50-day sits below the 200-day, this strategy takes nothing, however attractive the pullback looks.
- Price pulls back toward the 50-day MA. Price moves down to touch or dip below the line.
- The RSI (20) is at 50 or higher while price is at the average. A reading of 45 fails the test. The threshold is a number so that the decision is not made by eye.
- Entry is a buy stop above the previous session's high. A buy stop only fills if price trades up through that level. A stock that keeps falling the next session leaves the order untriggered and you in cash. This is a choice about order type, not a fourth condition on the stock.
Exits
The profit exit in this article is the RSI (20) reaching 70, the conventional overbought reading.
The protective exit is a close below the 50-day MA. The condition that defined the setup is the condition that ends it.
A close-below rule is not a stop order. It is read after the session ends, so the fill comes at the next open, and an overnight gap can put that fill well below the average. A separate stop order sits at a price and can fill during the session. The two behave differently on the same move, and a record that calls both "the stop" describes two different trades.
Position sizing
Risking 1% of equity on a $50,000 account puts $500 at risk. Position size is that figure divided by the distance from entry to the exit price, per share.
Worked through with invented numbers: entry at $46.10 and the 50-day average at $45.00 puts $1.10 per share between them, so $500 / $1.10 = 454 shares. At $46.10 that is a $20,929 position, about 42% of the account. A narrow gap between entry and exit always produces a large position, and the position, not the risk figure, is what an overnight gap acts on.
Widen the exit to $44.00, which is $2.10 per share, and the same $500 buys 238 shares, a $10,972 position. Nothing about your risk tolerance changed. The distance to the exit did.
A worked example
Invented figures, no real company, no trade that happened.
A hypothetical stock has a 50-day average at $45.00 and a 200-day average at $38.00, so condition one holds. Price runs to $52.00, then pulls back over two weeks to $45.20, touching the average. The RSI (20) reads 54, so condition three holds. Monday's high is $46.00, and the buy stop goes at $46.10. Tuesday price trades through it and fills at $46.10.
Risk per share to a close below the 50-day average is $46.10 - $45.00 = $1.10. Two weeks later price prints $51.00 with the RSI (20) at 71, which fires the profit exit: $51.00 - $46.10 = $4.90 per share, or $4.90 / $1.10 = 4.45R.
That R figure looks large because the exit sat close to the entry, not because the trade was well chosen. A setup that enters $0.30 above the average produces a bigger R on the same price move and gets stopped out by ordinary noise more often. R-multiples across trades are comparable only when the exits are placed by the same rule.
Keeping the record
Swingfolio ships a namesake template, and the exact name in the Strategy Library is "50-50 Trend Entry". On the new-strategy page, press "Import from Library", then hover the row and press Preview. The modal prints four entry rules: "Price is above 200-day SMA", "SMA 50 is above SMA 200 (golden cross confirmed)", "RSI (20) is above 50 (momentum confirmed)" and "Pulled back this week (entry timing)". The exit rules read "SMA 50 crosses below SMA 200 (death cross)" and "Price hits stop loss". The Risk Management block reads Stop Loss 5%, Target R-Multiple 3R and Position Size 2%.
Several of those differ from the rules above, so read them rather than assuming. The template adds "Price is above 200-day SMA" as its own condition, and it exits on a death cross rather than on an RSI reading. Its stop is a fixed 5% from entry, not a close below the 50-day average. Its pullback rule is a down week rather than a touch of the average, and it says nothing about order type.
Trades carry no tags. The trade form has a select labelled Strategy that reads "No Strategy" until you choose one. Choosing this one on a new trade writes a stop 5% below the entry price you typed, and a target 3R out from that stop. It leaves either field alone once you have edited it. It does not size the position, and the 2% is shown in the preview modal, the New Strategy form and the strategy's own page, but nothing applies it to a trade. The form's risk block prints Exp. Risk, Exp. Reward, R:R Ratio and Port. Risk from the units you entered. For a share count from a risk percentage, the calculator at /tools/position-calculator takes Entry Price, Stop Loss Price, Account Value and Risk Percentage.
Once trades close, the Strategy Performance page prints one row per strategy: Win, Avg R, Trades, Rules, P&L and PF. Whether this works better on one kind of stock than another is a question that row cannot answer on its own, and it needs enough closed trades before it answers anything. The Average R-Multiple card at the top of the Analytics page's Performance tab marks that with a "Low sample" pill showing your count over 20.
Where this goes wrong
- Trading the touch without the RSI. Price reaching the average is one condition of three. On its own it happens in downtrends too.
- Buying at market on the touch. The buy stop exists so that the session has to trade up through a level first. A market order at the average skips that test.
- Treating a close-below rule as a stop order. One is read after the close and fills at the next open; the other sits in the book.
- Comparing R across different exit rules. A tight exit inflates R and raises the stop-out rate at the same time.
Write down which exit you are using, the RSI period you are using, and which of the two "50s" your entry turned on. Then assign the next run of these trades to one strategy so the Win and Avg R columns describe one rule set. Start the 30-day trial if you want that record kept as you trade.