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Renko Price Action Idea
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Author:  r2997790 [ Mon Nov 28, 2011 10:45 am ]
Post subject:  Renko Price Action Idea
Hi everyone,

A huge thank you to Steve and all the other contributors here at the House of Hopwood, the positive and constructive contributions here are fabulous I am sure ForexFactory has seen a large drop in page views this month :)

Here's an idea I wanted to share with y'all and see if it makes sense to anyone and then perhaps Steve might be kind enough to code it for us to test.

Type: Renko (part martingale)
Pairs: EURUSD for starters (lower volitility pairs preferrable)
Lot Size: 0.1 initially, and then 0.1 increments thereafter
Renko Block Size: 10 pips (we're looking for block sizes which typically trend 2 blocks or more in one direction)
TakeProfit: 10 pips (1 renko block)
StopLoss: 20 pips (2 renko blocks)

Renko Setup: 10 pip blocks. EURUSD. I have attached the Renko EA to help make an offline chart.

Strategy:

1. After placing the EA on the chart and the close of the first candle open a 0.1 lot trade in that direction (eg. market moves up from open, place 0.1 long trade)

2. At the closing of each block (while the trend stays the same) open another trade in the same direction

3. At the close of every block close the current trade (this is the 10 pip TakeProfit). It might be smarter instead to implement a trailing TakeProfit to avoid the cost of the spread here.

4. A reversal will be at the close of a down candle. At this point we will close the losing trade and open a trade in the opposite direction at double the previous lot size to recover, eg. 0.2 lots (twice the lot size of the previous trade).

5. After this trade has recovered the loss of previous losing trade close 0.1 lot on that order and continue with 0.1 as per before.

Where there is a very tight ranging it is possible that the recovery lot doubling may occur a few times, however it is unusual for a significant period of consolidation on a renko chart.


That's it... I am sure others will be able to improve on this method, and I'm sure something similar has been many times before, so if anyone has seen something similar I'd love to see it...

Many thanks
Author:  stimpy [ Tue Nov 29, 2011 1:59 am ]
Post subject:  Re: Renko Price Action Idea
renko is just as painful as normal charts.
Author:  ewinner [ Tue Nov 29, 2011 10:43 am ]
Post subject:  Re: Renko Price Action Idea
Hi,

I have modified one of Steve's EA's to do what you want.. :D (hope you don't mind Steve)

If you want to use it with normal stop loss, take profit and trailing features then turn 'CloseAllTrade' to false.

Ive had it on demo unattended since yesterday afternoon using a 10 pip block and had

18 winners
9 losers
8 recovery trade winners

Be Warned - it trades alot - So only use this on DEMO, have fun

Mark
Author:  r2997790 [ Tue Nov 29, 2011 12:06 pm ]
Post subject:  Re: Renko Price Action Idea
Wow, Thank you eWinner... now to see if the theory is any good :)

There's a big concern over 1 box reversals... but we'll see.

Much appreciated!
Author:  ewinner [ Tue Nov 29, 2011 12:16 pm ]
Post subject:  Re: Renko Price Action Idea
Hi,

Your right, but the martingale seems to work, i started out on 0.05 lots and only seen 0.2 maximum so far.

Have a play with it, see what result you get.

Cheers
Mark
Author:  prakash.jj [ Tue Nov 29, 2011 5:28 pm ]
Post subject:  Re: Renko Price Action Idea
Hi,

I tried running this EA on GBPUSD, it got too many trades, but most of them are ended in loss. Which pair you are testing this?

Should we think of increasing the renko size?

Thanks,
Prakash
Author:  r2997790 [ Tue Nov 29, 2011 5:48 pm ]
Post subject:  Re: Renko Price Action Idea
Hi all -- I had a similar less satistfactory result on EURUSD ...

Mark what setting where you using? Could you share you .set file to avoid any confusion.

Further on this method, on a 10 pip block renko you don't see on 1-1-1-1-1 up-down-up-down action which is where these type of methods can come unstuck.

Here's a variation (again with a martingale element) that might be interesting to take a look at...

10 pip blocks.
Open order every block.
Close the order every after 2 blocks (ie. TakeProfit = 20pips).
0.01 lots per order on every order.

On a reverse double the current lot size to recover (eg. from 0.01 to 0.02 for the first up/down) for one trade only, when the new trend has established itself go back to 0.01 trades.

So: recovery lot size [number of 1 block moves] is...

0.02 [1]
0.04 [2]
0.08 [3],
0.16 [4]
0.32 [5]
0.64 [6]
1.28 [7]
2.56 [8]

I wonder how long it would take up to blow an account up with this martingale recovery?

Personally I've never seen more then about 4 up/down/up moves ... and you could choose to not trade the Asian session and before big news like NFP which may be more likely to flatline....

Any thoughts? I know this isn't exactly rocket science... I am sure others have done this before :)
Author:  ewinner [ Tue Nov 29, 2011 9:05 pm ]
Post subject:  Re: Renko Price Action Idea
prakash.jj wrote:Hi,

I tried running this EA on GBPUSD, it got too many trades, but most of them are ended in loss. Which pair you are testing this?

Should we think of increasing the renko size?

Thanks,
Prakash

Hi,

I have it setup only on EURUSD with a 10pip block size. But do play about with it and let us know your results.

It performed quite well today, i think ill start a new demo account tonight so i can post some results.

I have attached my setfile below for EURUSD

Cheers
Mark
Author:  ewinner [ Tue Nov 29, 2011 9:11 pm ]
Post subject:  Re: Renko Price Action Idea
r2997790 wrote:Hi all -- I had a similar less satistfactory result on EURUSD ...

Mark what setting where you using? Could you share you .set file to avoid any confusion
Hi,

I had reasonable success with it today, i have uploaded my setfile in the post above.

Im going to setup a new demo tonight and let it run for a while unattended, then we will soon see if it has legs or not.

On your other suggestion ive actually been playing around with another EA that does what your talking about, still work in progress at the moment but will let you know asap.

Cheers
Mark
Author:  stimpy [ Tue Nov 29, 2011 9:36 pm ]
Post subject:  Re: Renko Price Action Idea
i dont understand why one would introduce a system with martingale. just use martingale on its own!
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