If you've ever felt overwhelmed by the constant ups and downs on a regular candlestick chart, Renko charts might be exactly what you need. This unique charting method filters out market noise and shows you only meaningful price movements.
What Are Renko Charts?
Renko charts originated in Japan (the word "Renko" comes from the Japanese word for "brick"). Unlike traditional charts that plot price at fixed time intervals, Renko charts only add a new "brick" when price moves by a predetermined amount.
Why Renko Charts Work
Noise Elimination
The biggest advantage of Renko charts is their ability to filter out minor price fluctuations. When you remove the noise, trends become crystal clear.
Clear Trend Identification
With traditional charts, you might second-guess whether a trend is real or just noise. Renko charts make trends obvious — a series of green bricks going up is an uptrend, period.
Better Entry and Exit Points
Because Renko charts remove noise, support and resistance levels are more clearly defined. This leads to cleaner entries and exits.
Setting Up Renko Charts on TradingView
The right Renko settings depend on your trading style:
- For intraday trading: Use smaller brick sizes (0.1% to 0.5% of price)
- For swing trading: Use medium brick sizes (0.5% to 1%)
- For positional trading: Use larger brick sizes (1% to 2%)
Renko Trading Strategies
Trend Following
Enter when a new brick forms in the direction of the trend, confirmed by a moving average or Supertrend indicator.
Support and Resistance
Renko charts make key levels extremely clear. Buy near support bricks, sell near resistance bricks.
Double Top/Bottom Patterns
These reversal patterns are much easier to spot on Renko charts because there's no noise to obscure them.
Common Mistakes to Avoid
- Using brick sizes that are too small — this defeats the purpose of noise reduction
- Ignoring volume — Renko doesn't show volume, so combine it with a volume indicator
- Not backtesting — always test your Renko strategy on historical data before going live
Conclusion
Renko charts are a powerful tool for traders who want clarity over complexity. They work across all markets — stocks, F&O, forex, and crypto. Join Mukta Dhamankar's Renko Mastery webinar to learn the exact settings and strategies she uses to trade profitably.
