Looking to cut through market noise and trade trends with more confidence? Renko chart strategies give traders a unique edge by focusing only on significant price movement — not time. In this guide, you’ll discover how to use Renko charts effectively, from ATR-based setups to EMA crossovers and RSI pullbacks. Whether you trade forex, stocks, or crypto, these strategies can help you identify clearer trends, make smarter entries, and hold your winners longer.
📌 Quick Summary: Mastering Renko Chart Strategies
| 🔍 Focus | Price action (not time) |
| 🧠 Best For | Trend followers & swing traders |
| 🛠 Key Strategies | ATR Renko, EMA crossover, RSI pullback |
| ✅ Core Benefits | Noise reduction, trend clarity, simple entries |
| ⚠️ Watch Out For | Choppy markets, bad brick sizing |
| 📊 Tools You’ll Need | TradingView, MT4/5, Thinkorswim, NinjaTrader |
Prefer to watch how it works in real trade scenarios? Want to catch price reversals early—without getting faked out? In this video, we combine Renko charts, RSI, and MACD to help you anticipate potential turning points in the market. But here’s the twist: early signals are great, only if you wait for confirmation.
Table of Contents
🧱 What Are Renko Chart Strategies?
Renko chart strategies are price action-based trading techniques that rely on Renko charts, a type of chart that filters out time and focuses only on price movement. Unlike candlestick or bar charts, Renko charts display “bricks” that form only when price moves a fixed amount (or a dynamic amount, such as ATR). This makes them excellent for highlighting market trends while eliminating minor fluctuations.
These strategies help traders:
- Focus on real price movement
- Avoid false signals from low-volume noise
- Identify clear trend changes and breakouts
Whether you’re trading forex, stocks, crypto, or indices, Renko charts can bring clarity to your decision-making.
🎯 Why Choose Renko Charts?
Renko charts are especially helpful for traders who:
- Get overwhelmed by candlestick noise
- Miss major trends due to early exits
- Prefer clean visual confirmation for trend entries
Key benefits include:
- ✅ Noise reduction – No time-based candles to distort market flow
- ✅ Clearer trends – Bricks only form on significant moves
- ✅ Simpler rules – Easier to build consistent systems
📌 Renko is ideal for traders who value trend clarity over market detail.
🚀 Key Renko Chart Strategies to Master
📏 ATR-Based Renko Charts (Dynamic Brick Sizing)
How it works: This strategy uses the Average True Range (ATR) to calculate dynamic brick sizes based on market volatility.
- If the market is volatile, bricks get larger.
- If the market slows, bricks shrink.
Example Setup:
- ATR(14) applied to daily chart
- Brick size: Dynamic using current ATR
- Entry: Price closes above/below recent swing + trendline break
- Exit: Opposite color brick or trailing stop
Best for: Traders who want the chart to “breathe” with volatility — especially useful in forex or crypto where volatility fluctuates intraday.
Pro tip: Combine with a 50-period EMA. Only take trades in the direction of the slope.
🧱 Traditional Fixed-Size Renko Strategy
How it works: You choose a specific brick size (e.g., $1.00 or 10 points), and the chart builds bricks only when that amount of movement occurs.
Why it works:
- Simpler for backtesting and rule creation
- Ideal for traders who prefer mechanical setups
Example Setup:
- Brick size: 0.5% of current price
- Entry: Breakout of previous brick high/low
- Add: Volume filter to confirm real participation
- Exit: Opposite brick or fixed target (e.g., 2R)
Best for: Trend-following stock traders who prefer stability over adaptability.
🔁 Renko + Moving Average Crossovers
Strategy Setup:
- Add two EMAs to your Renko chart: 10 EMA and 25 EMA
- Buy when 10 EMA crosses above 25 EMA on bullish Renko bricks
- Sell when 10 EMA crosses below 25 EMA on bearish bricks
Benefits:
- Simple and effective in trending markets
- Offers clear confirmation and dynamic exits
Drawbacks:
- Lags in choppy conditions
- Can create whipsaws if brick size is too small
Pro tip: Use the slope of the EMAs as a filter — only trade when both are rising or falling together.
📉 Renko + RSI Pullback Strategy
This strategy combines the clarity of Renko bricks with the power of momentum reversion via the RSI.
Setup:
- Use fixed or ATR-based Renko chart
- RSI(14) added on separate panel
- Buy when RSI dips below 40 and bricks are bullish
- Sell when RSI peaks above 60 and bearish brick follows
Why it works:
- Allows you to enter trends at better prices
- Combines confirmation with mean-reversion logic
Best for: Traders who want to enter on dips, not breakouts.
Explore more: Watch the video, “Spot Early Reversals with Renko, RSI & MACD — But Wait for Confirmation!”
⚖️ Renko vs. Candlestick Charts
| Feature | Renko Chart | Candlestick Chart |
|---|---|---|
| Time-based? | ❌ No | ✅ Yes |
| Shows wicks? | ❌ No | ✅ Yes |
| Chart clarity | High | Moderate |
| Ideal for | Trend following | Pattern recognition |
| Filters market noise? | ✅ Yes | ❌ No |
📝 Renko charts are a trend trader’s best friend. Candlesticks are better for scalpers and pattern-based strategies like inside bars or pin bars.
❌ Common Mistakes in Renko Trading
- Using inappropriate brick sizes
Small bricks = choppy charts. Large bricks = late entries. Always backtest. - Ignoring confirmation tools
Don’t trade bricks alone — use trendlines, indicators, or volume. - Overtrading sideways markets
Renko thrives in trending environments. Sideways markets produce fakeouts. - Switching strategies too often
Consistency matters more than perfection. Stick with one method through a full market cycle.
🛠️ Best Tools for Renko Charting
- TradingView – Clean, real-time Renko charts (both fixed and ATR-based)
- MetaTrader 4/5 – Supports Renko via custom indicators or plugins
- NinjaTrader – Advanced Renko types, good for futures traders
- Thinkorswim – Built-in Renko charting for stocks and options
- Sierra Chart – Popular among pros for Renko backtesting
📌 Tip: Always verify that your platform supports custom brick sizes and non-time-based charts.
🧠 Pro Tips for Effective Use
- 🧪 Use ATR Renko for modern, fast-moving markets like crypto or forex
- 🧰 Stick to fixed Renko for backtesting ease and mechanical trading
- 🔍 Don’t go indicator-heavy — the chart itself is the strategy
- 📈 Backtest at least 6 months of data before going live
- 🔁 Practice in simulated environments (demo accounts) to build confidence
❓ Frequently Asked Questions
Q: What’s the best Renko strategy for beginners?
A: Start with fixed-size Renko charts and a 50 EMA for trend direction. Look for breakouts and test with small positions.
Q: Can I use Renko charts for day trading?
A: Absolutely. Use smaller brick sizes (e.g., 5–10 ticks) and confirm trades with RSI or fast EMAs.
Q: How do I choose the right brick size?
A: For dynamic sizing, use ATR(14). For static sizing, use 0.5%–1% of the asset’s price and adjust based on backtests.
Q: Are Renko charts suitable for scalping?
A: Not ideal — Renko is better for swing and trend trades. For scalping, candlestick charts with fast timeframes are more reactive.
🧭 Final Thoughts
Renko chart strategies offer a clean, data-driven way to reduce market noise, simplify your decision-making, and stay in trades longer. By combining brick logic with indicators like ATR, EMAs, or RSI, you can build systems that are both disciplined and flexible.
Whether you’re just starting out or fine-tuning a professional edge, Renko strategies are worth exploring — especially if you’re tired of choppy candlestick charts and conflicting signals.