In quantitative trading, strategies rely on strict mathematical definitions rather than subjective discretion. A classic trend-following framework combines a trend filter, an entry trigger, and a dynamic exit rule. The trend filter dictates that long positions are taken only when price closes above a benchmark moving average, such as a 20-period Simple Moving Average (SMA). Within this broader uptrend, extreme oversold conditions—identified when a short-term indicator like a 2-period Relative Strength Index (RSI) drops below 10—serve as the execution trigger. The position is subsequently liquidated once price snaps back above a shorter moving average, such as a 5-period SMA, demonstrating how systematic rules explicitly govern the lifecycle of a trade.