Renko Charts For NinjaTrader

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Renko charts are, in my opinion, the best ‘looking’ charts out there. I am sure some would say Point an Figure are, and they may be right in some respects but Renko has such a tidy aspect to them that they are just easy to look at.

Renko are a “type of chart, developed by the Japanese, that is only concerned with price movement; time and volume are not included. It is thought to be named for the Japanese word for bricks, “renga”. A renko chart is constructed by placing a brick in the next column once the price surpasses the top or bottom of the previous brick by a predefined amount. White bricks are used when the direction of the trend is up, while black bricks are used when the trend is down. This type of chart is very effective for traders to identify key support/resistance levels. Transaction signals are generated when the direction of the trend changes and the bricks alternate colors.”

There are serveral ways of trading renko charts. The most usual trading suggestion on a google search will state you should wait for clear resistance levels to form. Often in horizontal style channels. Then you should buy or sell a break out of such levels.

This while sound in theory is no different than buying a channel break out on a line chart or such like. So as I love the look of them I have been looking for different ways to trade them. Whichever way you look at them Renko charts are a simple price chart. So applying an indicator to the renko chart seems a logical step to finding a way to trade them.

After trying a few things I decided on trying a supertrend indicator. Below is a quick chart of the DAX futures, set to 5 ticks. This means a new box is only printed when the price has move 5 ticks or 2.5 index points. Obviously you can set the tick size to what ever size you wish.

Renko Chart

The way I would suggest trading this is using supertrend as your primary trend indicator and the renko boxes as your entry level. So you would wait for a new move with in the trend to get on board. Obviously you would have to apply some stop mangement system to make any system like this work.

Stops will have to be a minimum of two times your chosen tick size. This is because the price can move within that range without printing a count trend renko box. You could choose a lesser amount but there is no way by looking at historical charts of finding out how good/bad that chosen stop level would be.

The Dax seems quite a good index for such a system as it is quite fast moving index which often moves in decent ranges. The FTSE maybe a bit too choppy for such a system intraday.

You can download both SuperTrend and the Renko bars indicators for NinjaTrader for the indicator download page. The Renko indicator is a chart type so you will need to create a chart and select format data series and apply Renko and the desired tick size.

Click here if you are looking for Renko Charts For Metatrader.

5 Responses

  1. Roy says:

    The Renko bars shown are “wickless”. They also do
    have wicks, which can also be good signals. Does your
    version in Ninja trader have wicks?

  2. Jason says:

    Renko was not originally designed with wicks. The who point of renko bars is to cut out the noise of wicks. The ninjatrader version as far as I know does not have wicks.
    I think there is a version with wicks floating about for metatrader but I am not sure if we have it in the free download section.

    In what way are wicks good signals? I would be interested in hearing a different way of trading renko.

  3. Gary says:

    The issue of the renko chart is that the time axis does not show the same interval. I like the renko chart on myminter.com. It strech out the renko chart into the same interval at x axis and apply EMA on it to make it more readable.

    Cheers
    Gary

  4. Jason says:

    I am not sure what you mean? A renko chart interval is determined by it’s box size? On ninjatrader you can stretch the chart and change the box size at will. You can
    also put an EMA on the renko. YOU can even put heiken ashi colours over it as well. So I don’t really see your issue with it?

  5. Robbix says:

    Renko is the best viewing.

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