RAHA Weighted Moving Average Short Strategy

Summary

This short-term short-selling system uses Roni’s Adjusted Hybrid Average (RAHA), which weights prices less when they lie farther from the period mean relative to standard deviation. It combines RAHA averages of 5, 10, 20, and 40 periods to identify downward conditions, with a separate entry condition for a bearish candle entirely above the upper Bollinger Band. The text also describes a stop at the entry candle’s high, a profit target three times the stop distance, and position sizing intended to risk 1% of capital per trade.

Exits are tied to price or RAHA reversals, the stop, and an adjustment after three consecutive bearish candles. The document offers no performance results, and the supplied code does not fully align with the prose: the stated candle-sequence filter is absent from the entry condition, and the exit code requires a target touch alongside indicator exits. It flags sensitivity to parameters, choppy-market losses, and aggregate exposure across concurrent positions as limitations.

Key ideas

• RAHA reduces the influence of prices farther from the period mean using a standard-deviation-scaled weighting rule.
• The strategy combines several RAHA periods to identify short-term downside conditions.
• A bearish candle above the upper Bollinger Band provides a separate short-entry route.
• Stops, a multiple-of-risk target, and position sizing based on planned risk govern trade management.
• The written rules and supplied code differ in their candle filter and exit details.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.