Renko 12MTR

Hello All,

Thread rules are short and simple; Play Nice or You're Out.

EDIT 4/15/14 Here is a link to myfxbook for anyone interested.


I have been a currency trader for just over 3 years. Like many, I have been to hell and back both emotionally and financially...several times over. It took me almost that amount of time to figure out that I only have one enemy in this lonely business, and get it through your head, it is a business. The enemy is not your broker, not your combination of indicators, not their settings, not your pet, or even your spouse...it's YOU.

Again like so many, I bounced from this system to that system at least 10-15 times. Additionally within those systems, added, deleted, and changed probably 100 different indicators and their parameters looking for that "perfect" combination. I was on a "Quest For The Holy Grail". It had to exist somewhere, how could it not...with hundreds of indicators with dozens of settings...there absolutely had to be a combination of indicators and settings that fit the right to wear the title "Holy Grail"...Right?

Oh there is truly a Holy Grail, and it does contain the right combinations of parameters...it is own personal Psyche.
It is the combination of;
1) Faith--In a proven system, and knowing and accepting that any business sustains losses
2) Patience--In waiting for a particular setup and knowing that any systems setup will not catch 100 out of the 120 ADR of pips
3) Control--Of the frustration and anger, as well as the elation and ego. But most importantly, one of humanities most damaging traits...Greed.

So...what exactly am I bringing to the table. Having lived everything you have read so far, I finally figured out exactly what I personally need, to conduct this business each day.

Once I was able to calmly stand back from this business for while, I came to the conclusion that I need only 2 requirements:
1) A High Probability Entry
2) A High Probability Exit

As one scours the Forex forums, there are many worthwhile systems that do work for the system presenter, obviously, and some of his/her followers. (if you believe everything you read). I can tell you what failed to work for me most often, was number 2 of what I need...A High Probability Exit.

So here is what I have to present.

After a 6 month back test, and 2 months of forward testing, I have a system with a 78% success rate. Sounds great...right? But the majority will still fail without their Psyche in check, and I will show screen shots of trades that trended very well on a particular day, on a particular pair, and my setup only rewarded me with 14 pips. Many will state that this is not enough time to see all market scenarios. I strongly disagree. The market only moves 2 ways..trend or consolidation (ranging)...that's it! Six months provides hundreds of trending and consolidation periods.

OK...let's get to the charts.

As the thread title states, I am using Renko Bricks as opposed to time based bars. This was a huge initial breakthrough for me personally because I could now view charts the way my Program Engineering background processes information...1's and 0's. I use an 8 Pip brick...PA either went up 8 Pips (1's) or went down 8 Pips (0's)...that's it...nothing in between!

I will not spend anytime explaining how to set up Renko charts. Figure it out. There is a wonderful resource called Google that provides everything you need. I will of course provide the EA I use to produce them.

All Indicators are from various forums around the internet. A big THANK-YOU to those with the skills to program some of these custom indicators!

The Nuts and Bolts Overview


Extremely Simple...there are only 2 High Probability Entries and 1 High Probability Exit.
Indicators will be numbered 1 to 5.

Brick Size 8

High Probability Entry 1
Indicators 1, 2, and 2 more of the remaining 3

High Probability Entry 2
Indicators 2 to 5 (all but number 1)

High Probability Exit
2 Bricks (16 pips minus your spread)

Take Profit
2 Bricks

Stop Loss
3 Bricks

Pairs
GBPJPY, GBPAUD, XAUUSD

That's it. You will notice the pairs I use are all high volatility, but you are free to experiment with any pair you wish.

It is my exit rule that has made all the difference for me. Most of you will scoff at the point that my TP is 2 bricks and my SL is 3 bricks...Scoff Away, that's my rule. Everyone is free to make their own rules. I'm simply giving everyone a system that has proven very successful for ME.

My daily goal is 3 successful trades (just a guideline), 48 pips minus spreads. I use a script for entries, which I'll provide, which will set SL, TP, and % Equity for each trade, which I have set to 3%.

There you have it, Entries, Exits, and Money Management.

My next posts will be each of the indicators I use, their settings, and a screen shot.



Below are the latest files.
Should anything be altered during the course of time, this zip file will always represent the latest version.


My eyes are focused on a 3 Brick price reversal as pic describes. With high volume and volatility I will consider entering on the forth, but PA has to be moving quickly. For all intents and purposes, it is a 3 Brick reversal with indicators conforming as stated.

All right...the lagging indicators!

Everything will be contained in a zip file in post #1 after I have posted all indicators.

Indicator #1
RSI Chart Bar
Settings 8-0-52-48-1-3

Indicator #2
2 MA's attached to a Williams% Indi.

This is simply a couple of MA's crossing each other, except using Williams % data instead of PA.

--Williams % Indi. Seeting 45 Style=None
--Lime Smoothed MA2, Shift 0
--Red EMA8

Indicator #3 and #4

I am using these indicators to collect data on momentum. Like the Williams% Indi, I am using 2 MA's that look at the MOM-TC indi data instead of the indicators own data. Additionally I have added an SMI to the same Window.

Indicator #3 MOM-TC (Must be placed on chart first. When you attach the 2 MA's and set them to "First Indicators Data" it has to be the MOM-TC data they're looking at, not the SMI's data)
Setting Period 14
All Colors _None
MA's attached to MOM-TC
--Red Simple MA2,
--Dodger Blue Simple MA8

Indicator #4
SMI (Stochastic Momentum Indicator)
Setting 10-3-5-3-1
Colors Default

Keep it up. Renko is something I have studied for a long time but never have used

Last but not least..

Indicator #5

A basic Awesome Oscillator
Settings Default

Thank-you for the encouragement @Acroix70

So what have we got...

I am looking at market strength (the RSI), Momentum (MOM-TC and SMI), and a basic trend filter with the AO.

Remember I am only seeking 2 Bricks profit. My aim is to recognize and capture when the market is going to move 16 Pips...2 Bricks...that's it.

Next I will present High Probability Entry #1

Thanks SmokeyD.

Waiting for the High Probability Entry #1

Regards

High Probability Entry #1
(Sell Example, Buy would be opposite)

To Qualify---Indicators #1, #2, and 2 of the remaining 3.

Explained...

1) Indicator #1---A Neutral or Red RSI Bar on the second Brick following a Blue RSI Bar.
2) Indicator #2---An MA Cross that's looking at the Williams% Indicator data.

---2 of the following 3---
3) Indicator #3 An MA cross that's looking at the MOM-TC Indicator data
4) Indicator #4 The SMI is Red
5) Indicator #3 The AO is Red

Below is a good example of what many will find frustrating without Faith, Patience, and Control as I mentioned in Post #1. The screen shot shows my last four qualifying entries from this past Thursday and Friday, all successful. The first green line was the only qualifying entry on Thursday. Although it trended south most of the day, I only walked away with about 13 pips. Friday went well.

High Probability Entry #2

To Qualify---Indicators #2 to 5.

Explained...

2) Indicator #2---An MA Cross that's looking at the Williams% Indicator data.
3) Indicator #3 An MA cross that's looking at the MOM-TC Indicator data
4) Indicator #4 The SMI is Red
5) Indicator #3 The AO is Red

Below is Monday of this past week.

The first qualifying entry was an Entry #2. All but the RSI bar was heading south.
Without trying to muddy the waters, the second, somewhat discretionary, because the 2 Blue Bricks did not follow a Red, but it is one I took due to the momentum at the time.
The third was also a Entry #2, that took a while to come to fruition.
The fourth was an obvious Fail.
The fifth I didn't catch as I was in dreamland.

I want everyone and anyone who chooses to DEMO THIS FIRST, to keep in mind ALL the basics of trading. Session times, News, Major Pivot Points and BRN's (Big Round Numbers)

These are all basic trading skills and cannot be overlooked.

I also use an indi to show all major Pivot Points which will be in the zip file on Post #1 when I get it done. Fore ease of display, I did not show it on the screen shots.

Babypips dot com is a good place to start for beginners.

I have added the zip file to Post #1. Hopefully I have everything in there. I also include my template.

From this point forward, I don't plan to spend too much time here, but will try my best.

What I would like all interested in this business to posses, if they don't already, is Trade Calculator. There are many available, and I'm sure someone will share theirs if you don't have one.

That an 8 minute offline chart you have there? Never seen anyone use 8m before..

Later today I will try to post screen shots for the month of March and the first week of April. This will give everyone an idea of the success rate. Through the week I will try to post daily results on the 3 pairs I trade.

There is also an additional phase of this system that I use that I will introduce at a later date. I use 2 additional indicators to catch longer trend runs AFTER I have secured my 3 daily successful trades.

My participation will be in response to the overall interest in this system.

Here is a look at March 3-7, totally ignoring PP's, BRN's, and News, on GBPJPY only.

15-High Probability Entry #1---Green Lines
3- High Probability Entry #2---Magenta Lines
5-Failed---Red Lines

72% Success Rate

86-Total Net Pips based on my Brokers average 3Pt spread on GBPJPY

My actual total for this pair, based on what I have presented here, was 63 for this week...have to sleep some time. I added an additional 58 on two "Runners"(a trade I let run once I have my 3, 2Brick trades completed for that day). To be explained later.

March 10-14, totally ignoring PP's, BRN's, and News, on GBPJPY only.

16-High Probability Entry #1---Green Lines
6- High Probability Entry #2---Magenta Lines
7-Failed---Red Lines

68% Success Rate

Hi My Friend, Congratulation for your Thread..

As Renko Lover, I'm really glad and will follow your thread with interest and respect

Best regard.
MTH

Much appreciated @kiads

I still follow your thread as well.

As a matter of fact, my indicator #2, is my adaptation of your MTH-SSA.

Kindest Regards
SD

March 17-21, not a great week for the GBPJPY with the basic system. It was my 3 Runners that provided a small profit for this week.

17-High Probability Entry #1---Green Lines
5- High Probability Entry #2---Magenta Lines
10-Failed---Red Lines

55% Success Rate

March 24-28, totally ignoring PP's, BRN's, and News, on GBPJPY only.

11-High Probability Entry #1---Green Lines
3- High Probability Entry #2---Magenta Lines
3-Failed---Red Lines

79% Success Rate