Strategy based on the RSIOMA indicator
At the request of a forum member apelsinder we have implemented a trading advisor based on the proposed RSIOMA indicator. Since the main emphasis is on the work of the indicator, the rules of the strategy are very simple.
Trading strategy algorithm
The buy signal is triggered when the blue line of the RSIOMA indicator crosses the red line from bottom to top. Closing buy and sell is made when the lines are crossed inversely. That is all.
The author of the topic proposes to work on 15-30-minute charts on currency pairs GBPUSD or GBPJPY. The Trailing Stop is set at the level of 20 pips from the price (see Fig. 2).
Fig. 1. Work based on the RSIOMA indicator
Testing a trading strategy
The standard rules for an EA are simple, but usually they do not show the proper result. Let's see if RSIOMA will be an exception (see Fig. 3). We test it on the GBPUSD currency pair, 15-minute chart, from 2009 to October 8, 2010.
Fig. 2. Testing the trading Expert Advisor on GBPUSD. Download the report
Let's just say, the result is not happy. Smooth loss of the deposit without any chance of success. It is clear that the EA should not be used in this form, so let's try to improve it.
Optimizing the parameters of the Expert Advisor
As always, we will use parameter optimization expert. Let's see if we can revive an almost dead patient. Optimization is carried out "at the opening of a new bar", we take as working parameters the periods of the lines included in the indicator and, of course, the Trailing Stop.
It was very difficult to find a good result - the seemingly positive parameters obtained during optimization did not show the desired effect during the forward test. More or less acceptable parameters are as follows: RSIOMA=110, MARSIOMA=490, TrailingStop=30, while testing has been performed with the same participants: GBPUSD, 15-minute chart, from 2009 to October 8, 2010 (see Fig. 4).
Fig. 3. Optimization data of the expert. Download the report
Conclusion
As you can see from the results, trading on the indicator is not effective, at least with these rules. Judging by the testing, the RSIOMA indicator is quite good as a trend indicator, while in a sideways movement it is clearly inferior. Therefore, we recommend to use it as an additional to the already established tactics, without other filters it is contraindicated to work independently.
Description of the main parameters of the Expert Advisor
- RSIOMA - indicator setup 1;
- Ma_RSIOMA - indicator setup 2;
- TrailingStop - size Trailing Stops at points.