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RENKO TIMEFRAME CHANGING RENKO CHART

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darkpoet
435
darkpoet  

Hi guys,


I'm relatively new to renko but I have attached a renko indicator which I downloaded. All you need to do is attach to a chart (no need offline chart). Please take a look. I use a 100 point (10 pip) box size to plot the charts. Could someone please explain why the renko chart changes with time frame? Does it use live market price? I thought renkos were based on price movement and not time. And it is not just different amounts of data in the different timeframes, it is literally different chart patterns as the timeframe is changed and i do't understand.


thanks in advance.

Files:
Sergey Golubev
Moderator
101590
Sergey Golubev  

This is not a reply to your question but just the information about Renko I found on the forum - 

Sergey Golubev
Moderator
101590
Sergey Golubev  

Forum on trading, automated trading systems and testing trading strategies

Indicators: Renko

Sergey Golubev, 2013.09.03 11:03

Renko (extraction from Achelis - Technical Analysis from A to Z)

============

Overview

The Renko charting method is thought to have acquired its name from "renga" which is the Japanese word for bricks. Renko charts are similar to Three Line Break charts except that in a Renko chart, a line (or "brick" as they're called) is drawn in the direction of the prior move only if prices move by a minimum amount (i.e., the box size). The bricks are always equal in size. For example, in a 5-unit Renko chart, a 20-point rally is displayed as four, 5-unit tall Renko bricks.

Kagi charts were first brought to the United States by Steven Nison when he published the book, Beyond Candlesticks.




Interpretation

Basic trend reversals are signaled with the emergence of a new white or black brick. A new white brick indicates the beginning of a new up-trend. A new black brick indicates the beginning of a new down-trend. Since the Renko chart is a trend following technique, there are times when Renko charts produce whipsaws, giving signals near the end of short-lived trends. However, the expectation with a trend following technique is that it allows you to ride the major portion of significant trends.

Since a Renko chart isolates the underlying price trend by filtering out the minor price changes, Renko charts can also be very helpful when determining support and resistance levels.

Calculation

Renko charts are always based on closing prices. You specify a "box size" which determines the minimum price change to display.

To draw Renko bricks, today's close is compared with the high and low of the previous brick (white or black):

  • If the closing price rises above the top of the previous brick by at least the box size, one or more white bricks are drawn in new columns. The height of the bricks is always equal to the box size.

  • If the closing price falls below the bottom of the previous brick by at least the box size, one or more black bricks are drawn in new columns. Again, the height of the bricks is always equal to the box size.

If prices move more than the box size, but not enough to create two bricks, only one brick is drawn. For example, in a two-unit Renko chart, if the prices move from 100 to 103, only one white brick is drawn from 100 to 102. The rest of the move, from 102 to 103, is not shown on the Renko chart.

MetaTrader Trading Platform Screenshots

AUDUSD, D1, 2013.11.07

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renko + candlestick

AUDUSD, D1, 2013.11.07, MetaQuotes Software Corp., MetaTrader 5, Demo



Sergey Golubev
Moderator
101590
Sergey Golubev  

Here are my top 6 reasons of why I choose Renko Bars and charts:

  1. They REALLY help filter the noise
  2. They help smooth Indicators
  3. They can provide better entries
  4. They may help to provide smaller stops
  5. In my opinion they are just “cleaner”
  6. They help to filter noise and may help, keep us out of the chop.

whroeder1
17074
whroeder1  
  1. darkpoet: Does it use live market price?
    Files: renko-charts.ex4 27 kb
    Do you really expect an answer? Humans can't read EX4.

  2. If it changes then it is generating the Renko from the current chart and not from all available lower timeframes.
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