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Forex holy grail indicator for renko

Автор: Mutaxe | Category: Betting odds on super bowl | Октябрь 2, 2012

While the trend seems to be down when the Renko indicator shows trend below ForexBestShop Forex EA Trading Expert Advisor Metatrader 4 Mt4 Here you will. Hi everyone,. I have one trading system which I'd like to have as EA. This system is based on renko charts and mindhero indicator. Renko is the noise reduction king. If you are looking for black and white answers, Renko will serve. Technical traders love indicators for. FOREX FIXING SCANDAL

Can you spot the difference? Both charts show the chart based from the 26th until the current live price. But they look different So, for example, on the Bitcoin Renko Chart example 1, we are using a 1 Hour refresh time, and on Example 2, we are using a 15 second refresh time.

But what does that mean? On classic Candlestick charts, we choose the time frame of each candle. For example, let's say 1 Hour candles or 5minute candles. This means each candle represents the price changes within this time frame. Once we are looking at a Renko chart, we are not looking at the time. We are looking at price movements. That's why we define the size of a Renko brick. We don't care about how long it needs to build a 50 Points Renko brick. We care about the bricks are being constructed.

So if we have a Renko chart like the example, 1 with a 1 Hour "refresh," or let's call it confirmation timeframe, the bricks will be confirmed once an hour has passed by. Here is an example with Numbers. Now at 2. This means two new green bricks have been build and confirmed 2x 50 Points from But why is the price drop to It's simple Bricks are being confirmed after the refresh time.

So the Price can do whatever he wants within this time. In the end, it only counts the Price at 3 pm since it's set on a 1 hour refresh time. Because we don't care about TIME! We care about the price change. And with, let's say, a 15 second refresh time, the chart checks every 15 seconds whats the current Price is and confirms a new brick-based on that.

Here you can see the same price movement with two different refresh times. As you can see, those two charts look significantly different even if it's the same price movement. And then you have people using Renko with a 1 hour refresh time and wonder why they have lost their trade even if two new green bricks are built Again on Renko charting, we are looking at price changes, not time!

That's why we want the refresh rate as short as possible 1min or below. You might ask, "But then i have a red and green brick every 15 seconds and maybe have trades within a few mins??? This is where the brick size comes into place. Selecting the right brick size is one of the essential things to trade Renko successfully.

Brick sizes determine how your chart looks. The same chart with the same refresh time which we talked about above could look diffrent. Here are two examples at the Tesla Stock. Left side 50 Points brick size Right side 5 Points brick size As you can see, we have the same Symbol but with different brick sizes.

On the other hand, we see the chart on the right chart the Tesla Stock with a 5 Point brick size which shows thousands of Renko bricks. With that said, brick sizes determine how many bricks we see. This is important to fit it to your trading style. A long-term Investor might use the left chart with the 50 Points bricks when a daytrader uses the 5 Points chart. You might ask yourself now, why? It's kinda "simple". Let's say I am a long-term investor, and I am looking for a Stock that I can buy for the next years, and i need a "good" price to enter for the long-term Investment.

On the Chart below, you can see the Tesla Stock with a 10 Points brick size. As you can see, there are not as many Bricks as we would have on a 1 Point brick size, for example, but this chart could help a long-term investor find a good entry for a long position. For instance, he might look at the chart and Buys Tesla Shares after a period of Red bricks once a new green brick appears and sells them once a new red brick have been formed.

As you can see in that red brick period, we have a green brick that would trigger a long signal, but that's normal —That's why you have to work with a matching Stop-Loss Management. Most common and good Stop- Loss Managements include x your brick size. That means if you are trading on a 10 Points brick chart. Your Stop-Loss could be 20 or 30 Points below your entry.

On our Tesla example above, that would mean a long-term investor on this chart would have a 5. There are different ways to determine your brick size, and there are two brick size options as well. You can either use traditional brick sizes or ATR brick sizes. You go to your chart and enter manually the brick size you want to use for the specific Symbol. Try different brick sizes, look at the chart and figure out for yourself how many bricks are produced a minute, a day, or a month, and match it to your trading style.

As more you want to trade, the smaller your brick size should be. That's why day traders use smaller bricks lower point sizes , and long-term traders use bigger bricks higher point sizes. Just match it to your preferred trading style. If you generally have no idea whats a primary brick size for a Symbol could be, check ATR bricks; they will give you an Idea. ATR bricks are built on an average brick size in the past. For example, a standard ATR is This means the bricks are calculated based on the average price changes in the past 14 days.

Day traders often use ATR bricks. I personally don't like them since I prefer to check the prices in the past, let's say week myself, and set up my brick size manually based on that. That's also a reason why I prefer to use traditional Renko charts. But generally, ATRs are good if you are looking at a new Symbol and want a general idea about a standard brick size. Additional note: To use Renko charts on 1min or lower timeframes, you need to upgrade your Tradingview version. With Renko, all this scaling is in one setting — how much pips movement one bar represents.

Lower pip settings are for scalpers, the chart will move faster. Higher pip settings will generate a bar only once the price is really moving, so it may take a while. Just understand, Renko follows the price, there is no definite time when the Renko bars show up. If you like to trade on a daily timeframe usually, waiting for a candle to close at the exact time of day might be your routine. This routine does not apply to Renko trading.

You have to be ready to act when the price is moving and the bars are piling up. Of course, most Renko charts have the alert option, including some other custom indicators with the same function so you do not have to worry about missing the action. By this, we mean with the 10 pip settings a reverse bar can only form if the price moves 20 pips.

Notice a clear downtrend on the right side of the picture, a black upward bar will form only if the price moved 20 pips up, while the white bar needs only 10 pips in the downtrend direction to continue. So, it is double the set value. This is done to confirm the trend is losing momentum. Renko is thus designed to show exit points too.

Renko Pros Renko is the noise reduction king. If you are looking for black and white answers, Renko will serve. Technical traders love indicators for reasons they are based on numbers, numbers are crisp, there no fuzzy logic with them. Renko can be regarded as a digitalized chart that helps traders decide. Indicators based on price levels such as Fibonacci and others do not make much sense with Renko. One more reason why Renko is innovative, it will stimulate you to find unique rules and indicators that can match up with Renko.

This leads us to the next pro point. Renko requires the rules you can make up to the point Money Management does not need anything else. Pretty neat, traders do not have to bother a lot to create exit points, where to scale out, measure volatility, volume, trailing and all other info Renko just eats up.

Of course, you will have to try out what rules work for you, for example, try the two bar rule, exit, and enter when two consecutive bars appear. Renko Cons The truth is, you will need more than just Renko. Even it looks great, a ranging chart might destroy what you have built-in trends before. Whatsmore, Renko is not adjustable except for the pip settings. So the odds are you might need some more tools or rules like in the picture above to get it right.

As rigid as it is, Renko will work better on some trading assets than with others. Once you set up your bar pip value and the rules, all is set for that strategy. There are no messing with it now. You have to be present when the bars appear, and no one knows when it is going to happen. This is probably going to mess with the routine part of trading. However, all this is adaptive to how many pips you set, you can turn trading on and off whenever you like.