Quadpips,
I'm heading off to work so I can't spend a lot with this now. I'm browsing through the images you've posted as they are easier to grasp than those thousand words you had typed.
I'll quickly throw in a couple of questions though to get some coversation going.
Image 1: I'm not sure we really need that many EMAs... Wouldn't it just be easier to say when close < longest EMA? In your example it takes time before the pink EMAs cross the greens. In a fast market that can be costly.
Image 2: So what you're saying is short the market when it's trending lower and has moved enough against the trend. It is a good and often used entry technique. It works beautifully when you have a trend. When designing systems the biggest challenge (in my experience) is to define trends in such a way that I don't get false signals during the chop. Any ideas on filtering the chop out effectively?
Image 3: I found this a bit unclear but I might just be me trying to read it in a hurry. I probably should have read your text more carefully. Just one thing on this image: why not to choose stochastics values that'll give you better oversold signals or would you suggest using the pink EMAs for entry?
Image 5: Why should the first signal be skipped? That's where price created a higher low, which should signal a buy opportunity. Another thing: your system was to trade only when EMAs are fanned out. Here they are pretty close to each other, arent they? How do you define when they are fanned out enough?
I've gotta rush to work now, but I'll be checking back later on.
Cheers!
