Trading System: Rick D's Multi MA System

Trading System: Rick D's Multi MA System
Photo by Maxim Hopman / Unsplash

Four Indicators:

  • CCI (5) Line at +100, 0, and -100
  • Forecast Oscillator: Rperiod (15) t3_period (3) and b(0.7) Line at 0
  • Relative Vigor Index (1) Line at 0
  • ADX (14) Line at 20

(“Pivot” custom indicators / BT1 / BT2Sig / BT2Stop / Volume /)

Directional Indicators:

  • 5MA (Linear Weighted/Close)
  • 20MA (Linear Weighted/Close)
  • 100MA (Linear Weighted/Close)
  • 200MA (Linear Weighted/Close)

* The cross of the 5MA with the 20 MA favors the direction of the trade, (5MA on top favors Long trade, 5MA on bottom favors Short trade. And don’t trade too close to the 100MA, acts as a resistance line).

Entries:

Long:

  1. The CCI needs to be greater than (0).
  2. Forecast Oscillator needs to have both lines above the 0 line with the blue line on top.
  3. The RVI needs to have both lines above the 0 line and the style (Blue) line on top.
  4. The ADX Main and DI+ need to be at least 20 and rising.
  5. No BT2Stop in the way of the entry bar.
  6. Must be 15 pips away from a support or resistance line. (“Pivot” in custom indicator folder)
  7. The 100MA (LW/Close) no closer than 20 pips in the direction of the entry.

Short:

  1. The CCI needs to be less than (0).
  2. Forecast Oscillator needs to have both lines below the 0 line with the red line on top.
  3. The RVI needs to have both lines below the 0 line and the red line on top.
  4. The ADX Main and the DI- need to be at least 20 and rising.
  5. No BT2Stop in the way of the entry bar.
  6. Must be 15 pips or more away from support or resistance line.
  7. The 100MA (LW/Close) no closer than 20 pips in the direction of the entry.

Exit:

The RVI lines cross with the wrong color on top and a slight separation in them (0.2) (or) the RVI Style line crosses the 0 line against the trade. (up while in a short / down while in a long) which ever happens first.

I do feel that the RVI is a bit redundant with the forecast indicator, since they seem to move with the same rhythm.

Rick D suggested that he used this system in the 30m timeframe, and I’ve found it to be more reliable on 1hr, though it might just be personal taste as I prefer taking longer trades.

Also with directional bias, you don’t necessarily need to use moving averages, as I have found using the oscillators on a larger time frame to be more reliable, and less laggy, as mentioned in an earlier article (A Deeper Look into the Concept of Trend).

Over all, I like this trading strategy as it is very easy to follow, and allows for small stop losses, something that is crucial to anyone’s trading success.

The only possible drawback, would be the need for patience, as entry signals do not come often (maybe once or twice a day, on the 1hr chart), and you need to keep an eye on the charts for exits. A little bit of discipline can go a long way.