Nested Folder - Working with Current Folder

I have a set of rules which I wish to run on a file structure.

1. Old file/folders to be coloured labelled grey.
2. New file/folder to be coloured labelled red.
3. If any subfile/folder is colour labelled red then set the current folder label red.
4. If all subfile/folder are colour labelled grey then set the current folder label grey.

Rule 3 is partially working in that, if a file nested 5 layers deep is found to be red, the top layer folder is being set to red but the intervening nested folder are not.

Here is a screenshot to show the issue.

I am wanting the Travel, France and Photo folder to also be labelled Red.

I've tried reordering the order of the rules, changed when the loop should occur etc but have been unable to find the right combination.

Is this indeed possible? or is rule 3 being satisfied on folders higher in the structure (galleries) and thus not executing against lower ranked folders?

Have you checked the preview? See what rule those folders are matching.

I think I've got it sorted.

I was relying on just a final single LOOP rule as per the advice in the sticky.

I've found that, for rule 3, if, once having set the folder colour to RED, I force the logic to continue on sub-folders by adding a "Run Rules on Folder Contents", it seems to give me what I am after.

Reversing how some logic was interpreted also seemed to help.

I.E. Changing from

If ANY of the following condition are met for "all of its subfiles and subfolders"
Colour Label IS NOT RED

to

If NONE of the following condition are met for "all of its subfiles and subfolders"
Colour Label IS RED