How to Use Renko Charts in Ninjatrader
Renko charts are a unique type of chart used in technical analysis. They are based on price movement only, without regard to time, and can be helpful in identifying trending and non-trending markets. In this blog post, we will discuss how to use Renko charts in Ninjatrader. We will also explore the benefits of using Renko charts for trading, as well as some of the best practices for using them effectively.
Table of Contents
- What are Renko bars & Renko charts?
- How To Make A NinjaTrader Renko Charts
- Renko vs Japanese candles
- Renko Bars in Strategies
- Conclusion
- FAQ
- Risk Disclosure
What are Renko bars & Renko charts?
Renko charts are a technique to analyze a market’s price and to detect trends and un-trended sectors. The renko chart is unlike most candlestick charts because it focuses solely on price movement and does not include time-to-count.
Whenever new Renko bars are created the price moves the brick-based value of the corresponding block. The candle forms after a specified period is reached. In addition, Renko bricks are always placed at a 45-degree angle up or down from the previous brick and never side by side.
How To Make A NinjaTrader Renko Charts
- From the Control Center, click on New > Graphic
- Select an instrument in the upper left corner
- In the panel on the right side, set the Type to Renko
- Set any other parameters, including Block Size , and click OK
Renko vs Japanese candles
In the chart below, a standard 15-second chart is shown with alternating gold and black sections to indicate when each minute of time elapsed. Traditional candlestick charts are based on intervals, therefore each minute is represented by the same distance on the x-axis (even intervals).
In the example below, a 2-point Renko chart is used for the same time duration. Because Renko bars are built only on price information and not time, each minute has a different number of bricks. Although Renko charts are not time-based, time is still plotted on the x-axis.
Renko Bars in Strategies
Renko bars may be used in trading techniques to determine when a market is in a trend or simply sideways trade.
Identifying a potentially trending market with numerous consecutive green or red bricks is one way to do it. Alternating red and green bricks can be used to identify choppy and whip-saw buying and selling.
Conclusion
Renko bars display a range of values and eliminate chop, noise, so make entry signal is clearly visible. It is really easy to use in Ninjatrader and you can combine it with any strategy or combine it to make a confirmation of your signals.
In Strategy Generator you can create your own strategies without writing a single line of code in a few minutes.
FAQ
What is Renko trading system?
Renko trading system is a type of technical analysis that uses Renko charts to simplify price action and help identify trending and non-trending markets. Compared to traditional candlestick charts, Renko charts are unique in that they are based solely on price movement without regard to time.
How do you successfully trade Renko charts?
There are a few key things to remember when trading with Renko charts:
- The first is to always use a stop loss order when trading. This will help protect your capital in case the trade goes against you.
- Secondly, be patient and wait for clear signals before entering a trade.
- Thirdly, always practice proper risk management when trading. This means using sensible position sizes and never risking more than you can afford to lose.
Does NinjaTrader have Renko bars?
Yes, NinjaTrader does have Renko bars. Check this section.
Is algo trading more profitable?
There is no definitive answer, as algo trading can be more or less profitable depending on the individual trader’s skills and approach. However, algo trading can often be more profitable than traditional manual trading, as it allows traders to automate their strategies and trade them with greater consistency.
If you want to know more about this, check this article.
Which indicator works best with Renko?
There is no one-size-fits-all answer to this question, as different traders may prefer different indicators depending on their individual trading strategies and preferences. However, some popular indicators that can be used with Renko charts include the Moving Average, Stochastic Oscillator, and Relative Strength Index.
RISK DISCLOSURE
Futures and forex trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment.
Risk capital is money that can be lost without jeopardizing one’s financial security or lifestyle.
Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results.
Hypothetical Performance Disclosure:
Hypothetical performance results have many inherent limitations, some of which are described below.
No representation is being made that any account will or is likely to achieve profits or losses similar to those shown; in fact, there are frequently sharp differences between hypothetical performance results and the actual results subsequently achieved by any particular trading program.
One of the limitations of hypothetical performance results is that they are generally prepared with the benefit of hindsight. In addition, hypothetical trading does not involve financial risk, and no hypothetical trading record can completely account for the impact of financial risk of actual trading.
For example, the ability to withstand losses or to adhere to a particular trading program in spite of trading losses are material points which can also adversely affect actual trading results.
There are numerous other factors related to the markets in general or to the implementation of any specific trading program which cannot be fully accounted for in the preparation of hypothetical performance results and all which can adversely affect trading results.
