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What is a Forex Renko Chart? A Renko chart is a specific type of graph for displaying price movements of a financial instrument. The chart consists of blocks (a.k.a. bricks) which are the same size. These blocks can be bearish and bullish as in a standard bar or candlestick chart.

First, you should download the MQL4 file of the Renko chart indicator. This will prompt a pop up folder on your screen.

Then go to the following directory: You would simply drop the file there. Then you would restart the MT4 terminal. When you do this, you should see your Renko file there. After you do this, another window will pop up on the chart. This is the settings window of the Renko indicator you have just dropped on the chart. You may be thinking that nothing has changed, but on the top right corner of your chart you will see a text which gives you the Renko version you are using and a smiley face.

Also, you will see in the upper left corner a text which tells you that you need to open a MT4 chart offline to make the tool work. This is what we will be doing now.

A window will pop up, which contains different offline chart options. You should scroll and find the time frames listed in the upper left corner on the MT4 terminal. You now have an open Renko chart on your Metatrader 4 platform.

Any trader that has used Renko charting knows that it is very effective for gauging the price action of the instrument that you are watching. The Renko chart can clearly show the direction of the market. Since the chart basically smoothes the price action, we almost always have a present trend in front of us.

On the image above you see the different price swings on the Renko chart. Notice that there are no consolidations. There are smaller and bigger trends, but there are no overlapping ranges. The Renko chart is very effective for identifying support and resistance levels correctly.

Since the price action of the Renko chart contains the price action of a pre-specified pip movement, support and resistance levels can be very clearly displayed.

Below you will see an image which shows four levels on the chart. Notice that after the price interacts with each of them, we see the creation of a new directional move. The red circles on the chart show the moments when the Renko bars break an important level. As you see, each of these breakouts leads to the creation of a new trend. Opposite to this, the support, which is illustrated at the bottom of the chart is the beginning of a new upwards movement. After the price bounces twice from it, we see the creation of a new bullish trend.

As with support and resistance identification, chart patterns are also much easier to recognize on a Renko chart. The Renko chart above shows four classical chart patterns. The blue lines illustrate a Rising Wedge pattern. As you can see, the price drops after breaking the lower wedge line. Then comes a bullish channel, which is illustrated with the red lines. Notice that the price action creates swings in the frames of the channel.

After the bearish breakout, the price decreases. The next pattern is shown in green, and it is an Inverted Head and Shoulders pattern. After the creation of the second shoulder, the price increases again. The magenta figure is a Double Top pattern. The decrease which comes at the end proves the validity of the figure. As long as the bricks remain above the 13 EMA, we look to stay with the trend.

Just as the 13 EMA can get you in a new trade, the same EMA can be used to stop out a winning trade locking in profits. Traders will need to manually move the stop one brick-size below 13 EMA and the current price brick. You can see in the example above how the combination of Renko and the 13 EMA helps traders stay with the trend a longer time. Entries are important, but did you know that how you manage your risk is just as crucial? On page 4 of our Building Confidence in Trading we list questions your trading plan should address and answer!

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Also learn about potential drawbacks in trading with the Renko maker forex trading strategy. The equidistant price channel Renko trading strategy is a price action based trading strategy that is used to trade the counter trend moves. Using the equidistant price channel, traders can identify potential short term reversals that take place within a trend.

Learn more on how to trade price reversals on Renko charts using the equidistant price channel. This Renko trading strategy is based on trading the pull backs in a trend, by using the parabolic SAR indicator and combining it with Renko price action.

Read how to trade this rather simple Renko trading strategy. Make 20 — 50 pips every day with this simple to use and easy to understanding scalping set up with Renko charts. Learn how to make profitable trades intraday with a high rate of success using Renko charts and a trading strategy of your choice. Learn how you can make use of one of the most simplest of trading strategies.

Apply two moving averages to Renko charts and use the methods outlined in this article to trade one of the most powerful set ups you can find. Mini-median lines and median Renko charts is a simple but powerful trading strategy that can be used to scalp strong trending markets.

Learn how to apply this Renko trading strategy. For traders who want to make a fixed number of pips per day, this renko trading strategy is worth exploring.

The blue lines illustrate a Rising Wedge pattern. You are subscribed to Gregory McLeod.

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Equidistant price channel trading strategy on Renko Charts Posted by ranga on October 18, Read More The equidistant price channel Renko trading strategy is a price action based trading strategy that is used to trade the counter trend moves.

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