Simple Renko Trading System - How It Works
The currency strength meter can tip you off to several trading situations you should be aware of, such as the strength and weakness of a currency in relation to other currencies.
Trend-following is the most favorite trading strategy of professional binary options traders largely because of its effectiveness and profitability.In the previous article, we have shown you many effective trending tools that could help generate long-term income from binary options trading. Today, in order to continue the trend-sticking series, we would like to introduce to you another popular trending system which is very active, called Simple Renko.
What is Simple Renko?
The Simple Renko is composed of two famous indicators - Exponential Moving Average and Stochastic Oscillator.Having full features of an efficient trend-following technical strategy, this trading technique is really a good companion for mid-term and long-term market participants. The EMA set with the period of 20 days has the function to determine tradable trends and entries.
Meanwhile, the Stochastic Oscillator, with the setting of 45-3-3, is responsible for eliminating risky trading occasions that aren’t worth entering.The initial Simple Renko version is mostly used on the Renko Chart – a custom technical chart designed to make price action look simpler.
However, due to its complexity in installing the requiring indicators, we have made a few important adjustments in order to simplify the strategy usage.You will find out how to use our modified Simple Renko system below. Over the last 12 months being carefully tested by us, our Simple Renko technique has so far affirmed a win-rate of around 85%.
On average, there are 25 signals appearing every month.In this trading tutorial, we’re going to teach you what Renko charts forex are, how to use Renko charts live in your trading.
How to use the Simple Renko
This technical system works well on any time frames and is applied to any currency pairs, stock indices or commodities. The necessary indicators are available in Evotrade advance chart, you just need to install them following the guide above.A call opportunity is identified when:
- Prices cross above the 20-period EMA;
- Stochastic Oscillator lines move out the oversold territory.
- Prices break below the 20-period EMA;
- Stochastic Oscillator lines turn below the overbought territory.
- Only one position should be entered at a time;
- The penetrate-through candlestick must be fully closed before a signal is affirmed tradable;
- The expiry time should be established from six to eight times larger than the trading time frame. For example, you can set the finishing time to be eight hours when trading on the one-hour chart.
Pros and cons of the system
- Easy-to-use, general-purpose;
- Generating highly accurate trading opportunities by the strict checking requirements;
- Enabling traders to make continuous profits from long trends.
- Requiring a high level of patience.
The Simple Renko is a very efficient trend-following strategy which is highly suitable for mid-term and long-term binary options traders looking to make profits from trending market conditions. With a string of big advantages mentioned above in addition to a considerable testing result, we believe this trading companion can make you huge returns in the long run as long as you strictly stick to its trading rules. Of course, don’t forget to apply risk controlling and psychology managing methods because they are indispensable tools in your trading career. Always remember not to risk more than 4% of your account for each transaction.