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A Renko chart is a type of chart, developed by the Japanese, that is built using price movement rather than both price and standardized time intervals like most charts are. A new brick is created when the price moves a specified price amount, and each block is positioned at a 45-degree angle (up or down) to the prior brick.
- A brick can be any price size, such a 10, 20, 30, and so on. This is called the box size. Box size can also be based on the Average True Range (ATR).
- Renko charts have a time axis, but the time scale is not fixed. Some bricks may take longer to form than others, depending on how long it takes the price to move the required box size.
- Renko charts filter out the noise and help traders to more clearly see the trend since all movements that are smaller than the box size are filtered out.
- Renko charts typically only use closing prices based on the chart time frame chosen. For example, if using a weekly time frame, then weekly closing prices will be used to construct the bricks.
(Trend Reversal in Maruti)
To use Renko Chart in Spider Software:-
Chart(Menu) -> “Chart –> Point & Figure,Kagi, Renko, Darvas”.
Head & Shoulders Pattern In GRASIM (Weekly Chart).
Looks good above: 689.
Looks weak below: 689.
Rounding Top Pattern in BAJAJ-AUTO (Weekly Chart).
Looks good above: 2461.
Can be: 2705, 2881 & 3057.
Looks weak below: 2461.
Can be: 2354, 2178 & 2002.
Used Retracement to draw level.
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