Fxkred's Renko System

Originally I have opened this topic for a Renko counter indicator (similarly used as B-clock indicator at ordinary timeframe), but if I had enough time, I want to show my renko system. If there are some demand I prepare a trading room for scalpers, and day traders, who want to get dig himself into the renko trading.

For beginners:

What is a Renko candle at all?
Let's look at the official history of Renko candles by Investopedia:

" 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."

Read more: http://www.investopedia.com/terms/r/...#ixzz1sa2feoAb

The main difference between time- candles, and Renko candles:


1. Renko candles are independents from time, only the price range does matter. (Very similar to Range bars.)

For example if we have a 1 minute chart, and let us say before a news the price get into the 10 pip range channel, and do not brake out of it, we can see a sideway moving along the chart.

The same price moving is on a 10 pip body Renko chart is only 1 candle!!!
So the renko "swallow" the sideway moving.

In forex the price is in 70% sideway moving and in 30% trend moving. So easy to get the undertstand the importance of Renko chart.

I've been using Renko charts for years to trade futures and fx. They are superior for a Proper "read" on charts. Pursue it and Prosper!!

So let's compare a 8R chart to the 1 hourly candlestick chart.

Here is a Renco counter indicator, which I was written as could not found any under MT4.
Not perfect, but mainly does what it have to do. Here I want to give some language support, for the voice file as everybody likes to hear the Close up, Close down sentences on his mother language.

This is the English version:

Interesting thread, please continue!

Hi,

It is interesting to see a new idea, but could you clarify what you mean by 'Counter' ??

Counter meaning something that counts the candles ??

or

Counter meaning something which would show oppsite trend or trend reversal ??

Sorry, just to not confuse it from beginning...

I am following your thread by the way...

Can you please post template & all indicators. Thankyou

Next common question can be:

How long could be a Renko candle?

First , think about it, we use the term of Renko 4 charts for the BODY size of the Renko candle.
There are two types of use. Wicked or wickless.

Personally I used the first one, as the wick gives me very important extra information.
So if we refer R4 candle, it means only the body size could be 4 pips (ticks).

The maximum size of the Renko candle is 3 times of body size minus 1 tick.

Why? If we have a new 4R candle closed. After the momentum of closing, it could be go upstairs and downstairs.

Let's say going upstairs. When will be closed the next candle? After 4 pips.
What happens when it closed ?

(A female voice will say Closed up! If my renko counter indi is installed )
Well, you will have another brick above the previous one, without wick.

And if the next candle will red, (close down) how long will it be?

At least 8 pips which 4 pip is the body and 4 pip is the wick of it.

If this red candle before closing could move only 3 pips higher from the previous long renko ( 3 pips as it should be closed at the 4th pips), and 8 pip move down from the closing price of the previous closing price, so it gives teh maximal lenght of 11 pips to the 4 R candle.

Ok, Ok, but how can I make a renko chart?

1.
If you have a Ninjatrader 7 then you gave it for free as there is a native Renko candle type. This is the easier way to get Renko based charts.

You have to get a wicked Renko from the forum.

2.
The mainstream is the Metatrader 4. There is an Expert Advisor, I got it from the Mihailo's thread or Mr Nims thread.
Mr. Nims gives a detailed know how in a pdf how to install this EA.

You will need a very strong PC with lots of memory if you want to run it many pairs. Old laptops are nearly useless from this point of view.

http://www.forexfactory.com/showthread.php?t=237979

Good luck for installation

Ps. No solution until this for Metatrader 5. It could be a very very competitive disadvantages for it, I think.

Renko EA .

Thank you geo, I think it is the newest verision. The advantage of the Mr. Nims that it makes 2 type Renko at once.

As I remember the original coder of RenkoLivechart is LastViking. I found his blog, and downloaded the first version of the EA.

VERY Important : This EA do not makes any trading, its purpose to make the Renko offline chart for MT4.!!!

The EA here would create two charts at one go, if I am not wrong. Similar to previous one, just that this one does two charts at one go.

Use this Renko indicator. It allows you to control the no. of bars one wishes to be used. so theres not much load on the memory and even older pc will run smoothly.

Pls remember its an indicator and not an expert so its installed in experts----indicators folder. thanks

The next question:
How can I match the timeframes to Renko chart?

Well this is a basic question.
If you are a scalper, then you may use lower timeframes, 1 or 5 minutes. If you are a daytrader, then may want to see an m15 or H1 -like Renko chart.

Swing traders may want their H4 ,daily and weekly charts.


Ok , it is clear, but if the _Renko candle do not contain time factor, then how can I get similar look of it?

Lets approximate it from the common properties, the range. Time candles have range, Renko charts have range, too.

For example we have to get the similar Renko candle chart look to like H1 (hourly) candle chart.

We have to set the ATR(100) indi from the basic set of Mt4. It give us the latest 100 H1 candle average true range. It is right now at EURUSD = 21 as you can see it at the attached picture.
It means nowadays it is between 17 and 21 pip the average candle length at EURUSD in H1 timeframe.

So as we discussed before, that the Renko candle maximum length is 3 x body -1. So it is easy to calculate, 21/3 = 7. So the recent H1 EURUSD charts must be similar as the 7 R EURUSD chart!!!

Remember, we refer the Body size only when talking about 7 Renko, its max length could be 20 pips!!!
But personally I like to use the nearest Fibo number, which is 8. That is why I use 8 R instead of 7.
That result can be see on one of the post above

I hope that the picture of indi clarified the question. This indicator simply counts the pips BY PIPS until the possible Short and Long close levels.
Just simply as it is, not more.

I am confused sorry...

So if the EA you've attached is to count the pips using renko ??

What do we have to do to understand entry and exits ??

I mean how do we use the information of counted pips to trade ???

Am I missing something after reading all the posts ???

Maybe it is confusing, that I have to start to talk about a Renko system, then posted an indicators, so it may be identified that it is the system.

Not at all, it is a simply indicator (not EA) , and it is only purpose to show us (counts) the pips until the candle close.

If you have a H1 candle chart, then you know when will it close: at the end of the hour.
If you have lets say a 20 R chart, then you do not know when (what time) will it close. The only information is that how many pips are currently until close down (short close) or close up (long close). So it is easier to calculate the stops level if you can see it visually where will it close.
I could not found this kind of indi so I have written and posted, maybe somebody will find it useful , too. I just started to post in Mihailo's thread and did not want to off topics in his threads so started my own. That is why this indi get here.

I just started to present my system from the basement, and until know we have to make familiar with the Renko charts. No system element was mentioned, so come back later , if I had enough time I will continue it.

Now, we have renko charts, so start to able to "Viewing".

As the noise are engulfed by Renko candles, more easy to recognize some patters, for example harmonic patterns. Let us see how much occurred today.

Do not connects to my Renko system these harmonic patterns but heps a lot for confirmation if we able to see them. Especially when some fibo level is drawed to it.