Renko THV Trading Strategy
This trading strategy was developed based on the THV system and therefore uses a series of custom indicators for Metatrader 4 which are included at the end of the article. This system uses Renko bars and is based primarily on price action and does not take the time factor as much into account.
The best results are produced with box sizes of 5 pips and 13 pips. Of course the trader can test the system with different box sizes.
As always it is recommended to evaluate this system with a demo account before risking real money.
After installing the custom indicators and the template we will get an image like the following:
Example of a RENKO trading system template Related: Top Stock Investment Newsletters
System indicators with Renko charts
If the RenkopThv template is used, we will see the following indicators:
- Renko candelas
- Candles Heiken Ash
- Ichimoku Kinko Hyo
- Coral 55
- OsMACD 13 (OsMA and MACD combined in one indicator).
- Money Flow Index 13.
- FIM 13 (Momentum and Force Index combined in a single indicator).
- CCI 13.
- TRIX.
- T3 13: It is an indicator that shows when the fast line of the Trix indicator crosses the zero line.
- An indicator that shows when the market is trendless.
- Indicator with important market news. Entering the market 15 minutes before or 15 minutes after an announcement is not recommended.
The Heiken Ashi is used to more easily determine the direction of price action.
The other templates in the system have the same indicators shown above, what changes is the way they are organized. In my case, the Renko THV template was the most convenient. Through the following link you can download this template for Metatrader 4:
-RENKO trading system template and indicators Renko THV system rules
Long positions A buy position is opened when the following conditions occur:
- The renko chart turns blue.
- The price is above the Coral indicator.
- The price is above the cloud of the Ichimoku Kinko Hyu indicator.
- All indicator blocks turn blue for the first time.
- The price action on the M2 chart is above the Coral indicator and trending up.
- The price action is not close to any major resistance or support.
- There should be no major market news in the next 15 minutes.
Buy position example Example of buy position with RENKO system Short positions A short position is opened when the following conditions occur:
- The renko chart turns red.
- The price is below the Coral indicator.
- The price is below the cloud of the Ichimoku Kinko Hyu indicator.
- All indicator blocks turn red for the first time.
- The price action on the M2 chart is below the Coral indicator and trending down.
- The price action is not close to any major resistance or support.
- There should be no major market news in the next 15 minutes.
Sell Position Example Example of sell position with RENKO strategy Stop loss and take profit
With this system it is quite easy to determine the entry point, the most complicated thing is knowing when to close a position. In this case, a Take Profit level of 15 to 20 pips is recommended. Depending on the market conditions, sometimes the trader may try to make a profit of 50 pips.
The stop loss is applied based on the time frame that we are trading. A value of 35 to 50 pips can be used.
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