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I received Big Mike's invitation for the journals trading contest and I thought I would take place in this contest with something useful.
I do some forex trading and recently renko charts have drawn my attention. I opened an account with Oanda and I trade demo trying to develop my method. So far I have found some success.
I am calling this journal "Renko in underwear" because the only indicator I use is one that plots support and resistance, just to assist me to identify me with ease.
On my chart I also plot a 5 days Donchian Channel and a 10 days SMA. I just have them there hopping that my eyes will catch something useful for them and find a way to trade the breakouts. So far almost all the breakout trades I have taken ended as losers. On the contrary trading bounces from support and resistance all have ended in profits.
I use 50 pips blocks because I have a 9-5 job and I can't stay all day pampering the charts. I have the wicks enabled so I can follow better the price action. Every morning I wake up in 6:00-6:30. Watch the charts while sipping my morning espresso. If I find something that I like I give the pending order or maybe enter right there and I go to work. When I come back I look again at the charts and again if I see something pretty I may take it.
I have attached a screen shot of my chart template.
USDCHF trending down, bouncing from resistance, unfortunately inside some form of consolidation. The target can't be very far. The 0.91 looks like it is an important area so we should expect some hard time there. I don't like hard times so I am putting my tp there.
AUDCHF and AUDCAD. Both of them were taken on the breach of the 5 days Donchian Channel and both of them failed big time. My account was brought back to break even. A good solution for the breakout failures would be immediate exit, no question asked, at the creation of the first bar on the opposite direction ( or at least moving the SL few pips beyond that). Unfortunately if the market moves fast and no one is there to monitor it tis is not going to work. Maybe trailing stops would be a solution to this problem.
Anyway I took the loss today in these two trades but my account is still above the 0 line
NZDCHF made a higher high, took out the previous resistance and failed. Turned around more than 120 pips, trading under the up trend line, which BTW has been touched three times. I think it has the potential to reach to the previous support. And it did.
Pending short @ 0.75878
SL @0.77000
TP @0.75500
Profit +38 pips
Unfortunately so far my trading looks more like scalping. The account is still green but nothing exceptional. I really have to find a way to take advantage of those big moves.
This pair was in downtrend. Not a clean one but still a downtrend. That blue area I have marked in my chart was full of resistance. Price tried once more to break it and failed.
Short @1.5642
SL @ 1.5763
TP @1.5555 In front of the next support.
The pair was in downtrend, again failed to move past the resistance but this time with the added benefit of making a lower high and a lower low plus the added benefit of breaching the lower Donchian line.
From now on I am changing my strategy. I have removed the Donchian Channel and the EMA(10). I have replaced them with 3 moving averages SMA(10), SMA(20) and SMA(30). If these three moving averages are properly aligned then we have a trend in place and then we should look for points of entry in that direction. Otherwise no trade should be taken.
I don't know if this journal should be called "in underwear" anymore but I like the title
