1) What is Renko Chart?
• Renko is derived from Japanese word “Renga” or brick which ignores time and the movement is based solely on price.
• Renko charts filter out minor price movements, making them a preferred choice amongst many traders.
• Time is not a factor for Renko charts, it may be a technique that should be used for swing or position traders rather than for intraday traders.
• The only parameter which must be determined here is the size of the brick itself.
• The bigger the size, the less movement a chart will show but there will be larger stops on the positions. On the other hand, if you take smaller brick size, the sensitivity to price movement will be too high and the reason for using the Renko chart will be lost.