Hello all my students and visitors
this is a complete course about RENKO charting . you will learn how to
prepare your mt4 for renko
how to find the right program to create renko
how use these programs
how to test renko on strategy tester
how to code the strategy using mq4 (MQL4 ) language
What is a Renko Chart?
A Renko chart is a type of chart, developed by the Japanese, that is built using price movement rather than both price and standardized time intervals like most charts are. It is thought to be named after the Japanese word for bricks, "renga," since the chart looks like a series of bricks. A new brick is created when the price moves a specified price amount, and each block is positioned at (up or down) to the prior brick. An up brick is typically colored white or green, while a down brick is typically colored black or red
Renko charts are designed to filter out minor price movements to make it easier for traders to focus on important trends. While this makes trends much easier to spot, the downside is that some price information is lost due to simple brick construction of Renko charts.
The first step in building a Renko chart is selecting a box size that represents the magnitude of price movement. For example, a currency may have a 50 pip box size. A Renko chart is then constructed by placing a brick in the next column once the price has surpassed the top or bottom of the previous brick by the box size amount.
Renko charts show a time axis, but the time intervals are not fixed. One brick to could take weeks to form, while several bricks may form within a day or minuets. This varies from candlestick or bar charts where a new candle/bar forms at specific time intervals.
Increasing or decreasing the box size will affect the "smoothness" of the chart. Decreasing the box size will create more swings, but will also highlight possible price reversals earlier. A larger box size will reduce the number of swings and noise but will be slower to signal a price reversal.
Renko charts are effective in identifying support and resistance levels since there is a lot less noise than a candlestick chart. When a strong trend forms, Renko traders may be able to ride that trend for a long time before even one brick in the opposite direction forms.
Trading signals are typically generated when the direction of the trend changes and the bricks alternate colors. For example, a trader might sell the asset when a red box appears after a series of climbing white boxes. Similarly, if the overall trend is up (lots of white/green boxes) a trader may enter a long position when a white brick occurs after one or two red boxes (a pullback).
