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The RDS Forex System: A Breakthrough Method To Profiting from Market Turning Points by Stephanie Radkay, Michael Radkay

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CHAPTER 10

Defining the Rotating Directional System

Our strategy, RDS, stands for Rotating Directional System. RDS is a five-rule-based discretionary trading methodology that establishes risk management first. Our style offers the trader a trend-side philosophy that predicts time and price objectives using counter-trend reversals as a guide for entries, exits, and overall worth of the trade. After appropriate RDS risk-management parameters have been analyzed for the market of choice, levels of participation are developed from recent market volatility, average momentum, and retracement zones. As prices reach a specific zone objective, new rotation significance is placed on this area. This continues to give the trader an overall updated directional sense of what can be expected for upcoming price action. The zones also post guidelines for price follow through and/or reversals.

Before entering each trade we put the position of the market up against rule one, the homework rule, and four intra-day rules.

RULE 1: THE HOMEWORK RULE

In order to understand the homework rule we need to make sure you have a solid understanding of the Japanese candlestick chart. We know most of you are adept at this, but as educators, we want to make sure.

The candlestick chart is a tool that gives us an indication of exactly where the market is at any point in time and where the market has been, as well. We prefer to use this type of chart over a bar chart or a point-and-figure chart because the colors ...

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