Hm. While an interesting mechanic, I'm not sure if it's a very good system for this format of RP. It would probably work well in a tabletop or arena RP, but I feel like the situations your colours are showing could be taken from the writing itself and are just kind of unnecessary. And this could just be me but I'm not sure how this system is meant to work, would it be the situations of our characters in your posts as you see them or do you want us to adopt it? Now of course it's your system (unless you wanted us to adopt it?) so I won't say a thing if you want to use it, but I personally would rather not. 
[s]not to mention I generally don't like coloured text because my eyes are weird and get angry at brightly coloured text[/s]