{"id":60092,"date":"2014-09-10T00:24:54","date_gmt":"2014-09-10T04:24:54","guid":{"rendered":"http:\/\/countingpips.com\/?p=60092"},"modified":"2014-09-10T06:40:04","modified_gmt":"2014-09-10T10:40:04","slug":"trading-with-renko-charts-the-holy-grail","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2014\/09\/trading-with-renko-charts-the-holy-grail\/","title":{"rendered":"Trading with Renko Charts \u2013 The Holy Grail?"},"content":{"rendered":"
September 10, 2014<\/div>
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Traders who venture out to trading off Renko charts, some if not most do so after spending considerable amount of time trading and testing out various traditional trading strategies. Most of these strategies, which are quite popular, are focused on indicators based off the candlestick, line or bar charts. Traders tend to turn to Renko charts for day trading after not seeing the results they expect with their trading system or their current approach. This brings to question if trading Renko charts is the Holy Grail of day trading.<\/p>\n

Before we go into the details, another factor that brings about this question is the numerous ready-to-use trading systems built on Renko charts which tend to show in hindsight the ease with which a trader can possible trade. But is that really the truth and is trading Renko charts and a Renko trading system<\/a> the answer to a trader\u2019s day trading woes? Let\u2019s explore in a bit more detail!<\/p>\n

Trends are easier to spot with Renko Charts<\/h3>\n

It is indeed true that trends in forex pairs are much easier to spot with Renko charts. But if you step back a little, you will notice that it is the same with any charting technique. The only difference is in the visual depiction of prices. Buying or selling into a trend with Renko charts is in fact the same as with any other conventional form of charting. While Renko charts do seem easier in hindsight, trading off Renko charts as price evolves is a different story. So the next time you come across a fancy looking Renko chart with the author claiming how simple it is to buy or sell, think again! Things are not always how they seem to be.<\/p>\n

Price Action Trading is simpler with Renko chart trading<\/h3>\n

Yes, due to the absence of wicks and other such noises, Renko charting offers a better approach for price action traders. Therefore it is easier to identify and trade chart patterns such as head and shoulders, triangles, trend lines and so on. Practicing price action traders will find it a lot easier to test and learn their price action trading skills with Renko charts compared to other traditional charting methods.<\/p>\n

Whipsaws are much lesser with Renko charts<\/h3>\n

Renko charts are not immune to whipsaws and are in fact a commonly occurring theme. But of course, most references to Renko charting tend to skip this bit, either intentionally or unintentionally. The whipsaws are especially more dangerous if you are already in a trade. Depending on your Renko chart settings, trading whipsaws could easily put a dent in your trading equity.<\/p>\n

Renko trading systems seem to work better<\/h3>\n

There is no proof that applying a traditional trading system to Renko charts will help improve the trading system. Remember, that Renko charts are not something out of this world and the one thing common to any charting method is that it relies on price and the unfolding price action. Therefore, do not fall for the myth that applying an existing trading strategy would automatically work well with Renko charts.<\/p>

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Trading Renko Charts is not the Holy Grail, but its close<\/h2>\n

Depending on your experience and familiarity with Renko charts, traders can indeed find an edge, when combined with money and risk management and a lot of patience and discipline. While Renko charts are not the Holy Grail of trading, with enough practice and familiarity with the Renko charts and the trading system, the odds of growing your trading equity can greatly increase.<\/p>\n

About the Author:<\/strong><\/em><\/p>\n

Ranga, is a full time forex trader and a blogger at http:\/\/renkotraders.com and trades specifically using Renko charts. He is well experienced and brings his mix of technical analysis including both price action as well as indicators based trading applied to Renko charts.<\/p>\n

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Traders who venture out to trading off Renko charts, some if not most do so after spending considerable amount of time trading and testing out various traditional trading strategies. Most of these strategies, which are quite popular, are focused on indicators based off the candlestick, line or bar charts. Traders tend to turn to Renko […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-60092","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/60092","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=60092"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/60092\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=60092"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=60092"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=60092"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}