I wrote a post a few months ago about the use of tick charts in the forex market and how these can be implemented on the metatrader 4 platform. I have noticed that the video post has had a lot of success and it has allowed many people to finally get tick charts in their mt4 platforms. Today, I am going to talk to you about another type of charts called "renko charts" or "fixed range charts". These charts, are another alternative to time based charts (like tick charts). They don't show us a fixed amount of time (like time charts) or a fixed amount of volume (like tick charts) but a fixed pip range. A renko block chart shows us a fixed range movement for each bar that is displayed on the chart (each bar is an X pip movement). The renko charts are excellent for the location of patterns and support/resistance levels on charts becase this information is displayed in a crystal clear fashion.
However, renko charts are no holy grails. They look visually very appealing but the fact that you have to wait for a fixed range to close before you can confirm a signal makes the renko charts particularly lagging when compared with time based charts. However, renko charts, as I said before, show us a very good picture of the overall market movement and are invaluable tools for a trend follower or support/resistance trader.
How do we draw renko charts on metatrader 4 ? Well, lucky for us, this matter has already been answered by the people at forexfactory however, I am also making a video so that you all can easily get your renko charts (range based charts) on your mt4 platforms. You should remember that backtesting is impossible on renko charts as the backtester does not support the loading of offline charts for testing.
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If after viewing this video you would like to learn more about automated trading systems and how you too can develop and program your own long term profitable trading systems please consider buying my ebook on automated trading or subscribing to my weekly newsletter to receive updates and check the live and demo accounts I am running with several expert advisors. I hope you enjoyed the article !
However, renko charts are no holy grails. They look visually very appealing but the fact that you have to wait for a fixed range to close before you can confirm a signal makes the renko charts particularly lagging when compared with time based charts. However, renko charts, as I said before, show us a very good picture of the overall market movement and are invaluable tools for a trend follower or support/resistance trader.
How do we draw renko charts on metatrader 4 ? Well, lucky for us, this matter has already been answered by the people at forexfactory however, I am also making a video so that you all can easily get your renko charts (range based charts) on your mt4 platforms. You should remember that backtesting is impossible on renko charts as the backtester does not support the loading of offline charts for testing.
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If after viewing this video you would like to learn more about automated trading systems and how you too can develop and program your own long term profitable trading systems please consider buying my ebook on automated trading or subscribing to my weekly newsletter to receive updates and check the live and demo accounts I am running with several expert advisors. I hope you enjoyed the article !
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2 comments:
hi buddy, your blog is great.
Renko charts is able to be backtested. I have written script to load feeds from renkolivechart, and pass the trade message from renko chart to renkolivechart for trading, which makes it possible to follow the trade signal.
Honestly it is a lot work.
Hi Chen,
Well, I would be pleasantly surprised if backtests could be done on renko charts using the strategy tester. That will certainly make things easier to test strategies developed on these charts ! Would you like to explain in a little bit more detail how you achieved this ?
Thank you for your comment !
Best Regards,
Daniel
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