Renko chart trend lines, along with patterns across the chart, provide viable trading strategies in 2 ways:
- The trend line break can be a trade setup, but it can also be used as support or resistance for price filtering
- There are bricks of ‘random’ price movement that really don’t give a tradeable setup, but a breakout of a bigger pattern that contains these bricks can be traded
Look at the chart below and you will see the purple lines (a) the Renko chart down trend line and flat base (b) the bigger pattern across the chart, which is a bull wedge.
Trend lines and patterns actually aren’t always as visibly clear on the Renko charts as they are on the tick bar trading charts. Possibly this is due to the symmetry of the bricks compare to the bars.
But whatever the case, using the Renko chart trend lines and patterns are as effective as day trading strategies, as they are when trading them on tick charts.
Renko Chart Trend Lines And Patterns Video
This will be further discussed in the Renko trading strategy video, but note the following:
- The down trend line acted as resistance and a price trade setup filters, at the time of the 2 purple circles price envelope reverse trade setups
- The Renko chart bull wedge pattern breakout was entered at yellow circle1
- The 2nd point of the trend line [purple square] also acted as resistance, when it was retested
- And then the break2 of the line, combined with the extreme indicator momentum hook, gave a price failure break addon trade at yellow circle2
- Yellow circle3-4 are 2 method trade setups that were also traded
- Compare yellow cricle4 and yellow circle2, and you will see another 4 Renko brick midline reject, with a momentum hook and especially good MEx flow
Clink Link To Watch Video: Renko Trend Lines And Pattern Trading Strategies