RAIQS system for implementing the "follow the market" strategy

System RAIQS is designed to following the market in the trend, in the flat and on the reversals. The analysis of two layers in the TA system RAIQS, allows you to cover a wide range of changing dynamic properties of the signal of the traded instrument quotations.

This publication is a continuation of the article: "Following the market according to the RAIQS system of four indicators", which describes the RAIQS TA system of four indicators (RASL, RAOS, RAMA, RAOSQ).

Construction of a two-layer TA RAIQS system

The basic principles of two-layer TA systems are discussed in the article "Indicators for RASL + RAOSQ technical analysis system".

1. Shape the first ("fast") layer RASL fluctuations of the signal quotes, of prisoners between 5 and 20 periods

Figure 1 shows an example of a single-layer RAIQS system of four indicators (RAMA, RASL, RAOS, RAOSQ) to implement the strategy "following the market"for the quotations of Brent (Daily, end date May 25, 2018). Their setting parameters and purpose are described in detail in the article "Following the market according to the RAIQS system of four indicators".

Figure 1. Brent crude oil rate (Daily, end date May 25, 2018). RAIQS single-layer system.
Figure 1. Brent crude oil rate (Daily, end date May 25, 2018). RAIQS single-layer system.

2. Form the second ("slow") layer RASL fluctuations of the quote signal of prisoners in the range of 20 to 40 periods.

Figure 2 shows an example of a single layer RAIQS for Brent crude oil quotes (Daily, end date May 25, 2018), but for a "slower" layer of RASL signal quotes.

Figure 2. Brent crude oil rate (Daily, end date May 25, 2018). RAIQS single-layer system.
Figure 2. Brent crude oil rate (Daily, end date May 25, 2018). RAIQS single-layer system.

Figure 2 shows:

  • moving average RAMA(28) with an averaging period of 28 (bold black line),
  • RAOS(28) oscillator (magenta lines), displays the rate of change of the RAMA(28) indicator,
  • RAOSQ(28) quadrature oscillator (black lines), displays the change in velocity (acceleration) of the RAMA(28) indicator,
  • RASL layer indicator (bold gray lines) for the layer of fluctuations of the signal of quotations, concluded in the interval from 20 to 40 periods.

All indicators are set to approximately the middle of the RASL layer.

Figures 1 and 2 show that the lines of the RAOS oscillator practically coincide (slide along) with the upper or lower boundary of the RASL layer indicator when the quotes signal moves in the direction. At the change of direction (rise, fall) the lines of the RAOS oscillator pass from one border of the RASL layer to another (upper or lower), the lines of the RAOSQ quadrature oscillator form the "proactive" signals of the local divergence (within the RASL layer) about a possible reversal, decay or resumption of the directional movement.

3. Combine the first "fast" and the second "slow" layers RASL

Figures 3, 4, and 5 show three options for combining Figures 1 and 2.

Fig. 3. First version of the combination of Figures 1 and 2. Two-layer RAIQS system.
Fig. 3. First version of the combination of Figures 1 and 2. Two-layer RAIQS system.

The bottom part of Figure 3 additionally shows a thin blue "close" line of the quote signal.

Fig. 4. Second version of the combination of Figures 1 and 2. Two-layer RAIQS system. The boundaries (orange lines) of the first ("fast") RASL layer are not shown.
Fig. 4. Second version of the combination of Figures 1 and 2. Two-layer RAIQS system. The boundaries (orange lines) of the first ("fast") RASL layer are not shown.
Fig. 5. The third option of combining Figures 1 and 2. The two-layer RAIQS system.
Fig. 5. The third option of combining Figures 1 and 2. The two-layer RAIQS system.

Figure 6 shows the completion of Figure 5 in more detail.

Figure 6. The two-layer RAIQS system. Completion of Figure 5.
Figure 6. The two-layer RAIQS system. Completion of Figure 5.

Examples of two-layer TA RAIQS system for other quotation signals

The indicator settings for all examples of the article are not changed.

Figure 7 shows an example of a two-layer RAIQS system for implementing the strategy "following the market"for quotations of the EURUSD pair (Daily, end date May 25, 2018).

Figure 7. RAIQS two-layer system.  Quotes of the EURUSD pair (Daily, end date May 25, 2018).
Figure 7. RAIQS two-layer system. Quotes of the EURUSD pair (Daily, end date May 25, 2018).

Figure 8 shows an example of a two-layer RAIQS system for implementing the strategy "following the market" for GOLD rate quotes  (Daily, completion date May 25, 2018).

Figure 8. RAIQS two-layer system.  GOLD rate quotes (Daily, end date May 25, 2018).
Figure 8. RAIQS two-layer system. GOLD rate quotes (Daily, end date May 25, 2018).

Figure 9 shows an example of a two-layer RAIQS system for implementing the strategy "following the market" for USDRUB pair quotes (Daily, completion date May 25, 2018).

Figure 9. RAIQS system.  Quotes of the USDRUB pair (Daily, end date May 25, 2018).
Figure 9. RAIQS system. Quotes of the USDRUB pair (Daily, end date May 25, 2018).

The two-layer TA RAIQS system is designed for effective implementation of the strategy "following the marketIn this case, it is necessary to use the "in-trend, flat and reversals in a wide range of changes in the signal dynamics of the traded instrument quotations.

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