Renko Indicator MT4: What It Is And How To Use it
Welcome on our Best MT4 Indicators website! The forex market is highly dynamic; as such, for you to make consistent profits in the course of your trading career, you must follow market trend movements and know when to quickly exit a trade position. While there are technical top forex indicators you can rely on to track market trends, how do you monitor market movements to determine when to quit the scene so that you don’t lose your money?
One of the best tools you can use is the Renko indicator MT4. The Renko indicator helps traders in determining when a market moves significantly and to what extent it has moved. It is one of the few indicators that emanated from Japan. Unfortunately, it is not pre-built on the MT4 trader. You have to download and install it on your trading chart.
In this article, we will take a look at what the Renko indicator is about, how it works, advantages and disadvantages of using the tool, and round up with how to install and uninstall the tool. Let’s go!
What Is The Renko Indicator?
The Renko indicator is a tool that draws Renko blocks on the MT4 chart when there is a significant market or price movement. The blocks that are drawn can be separate or continuous elements, and have varying length and width. The Renko indicator can be applied to different trading strategies depending on what you want. Whether you are a beginner trader or a veteran, downloading and installing the Renko indicator is very easy and straightforward.
Additionally, this tool has useful features like issuing alerts the moment there is a new block and the ability to display the current price of an asset when a new block will start.
A Brief History Of Renko Indicator
The Renko indicator MT4 draws its name from the word “renga,” which is a Japanese word for “bricks.” This indicator was first imported by Steven Nison to the US during the publication of his book titled “Beyond Candlesticks.”
The Renko indicator MT4 is very helpful, especially when determining support and resistance levels. Plus, it can suggest when a trader should enter or exit a trade position. To get the best from the Renko indicator, you can combine it with other technical indicators like moving averages, MACD indicator, Stochastic Oscillator indicator, as well as support and resistance indicator.
How The Indicator Works
Market movements signaled the emergence of new blocks (either blue or red bricks). When a blue brick emerges, it indicates that there is an uptrend on the market. Similarly, when the indicator generates a red brick, it means there is a downtrend on the market.
Let’s take an example, supposing the current Bitcoin price is $7,900 and you set the indicator to create bricks at $10 each, the moment Bitcoin price increases to $7910, the indicator will immediately create a new brick to reflect Bitcoin price increment. But if Bitcoin price increases to $7909, the indicator will assume that the price movement is not significant enough and won’t create a new brick.
It is also important that we emphasize here that the bricks created by the Renko indicator remain unchanged because the indicator does not repaint.
The bricks help traders to clearly see trends since it doesn’t create a new brick if the price movement is not significant. The indicator forms bricks using the closing prices of your MT4 trader. Off course you can combine the renko indicator with other good ones such as the chande kroll stop indicator.
Benefits And Demerits Of The Renko Indicator MT4
The major benefit of using this indicator is that it helps to reduce or completely eliminate market noise. Thus, traders are left with a clean chart during trading.
Another benefit of using this indicator is that it is perfect when it comes to highlighting resistance or support levels in the FX market. Also, newbie traders will enjoy using the Renko indicator to technically analyze the market.
Furthermore, the Renko indicator MT4 helps different categories of traders to easily spot trend and retracement patterns.
The Renko indicator doesn’t provide information like open, high, close, and low. Also, the indicator may give false signals at some point; that is why it is important to combine it with other technical indicators.
How to Install The Renko Indicator on Your MT4 Trader
1. Downloading the indicator from a reliable source and save the file where you will remember
2. After downloading, copy the file to your MT4 indicator directory
3. Restart your MT4 trader if it was already active.
4. Search for the Renko Indicator in the custom indicators list
5. Drag and drop the Renko Indicator to your MT4 chart
6. Adjust the default settings and press okay
7. The indicator should appear on the chart.
How to Remove The Indicator
1. Start the MT4 trading chart
2. Go to the custom indicator list
3. Search for the Renko Indicator
4. Right click on the indicator and click on delete
Summary of Renko Indicator MT4
The Renko Indicator MT4 is a versatile technical indicator that every trader should download and install to improve his/her earnings. The indicator generally helps traders to determine when there’s a significant price movement on the market.
You can play around with the Renko indicator’s settings to understand its effectiveness and how to adjust it to suit your trading strategies. But we caution that you try it with a demo account only; otherwise, you may lose money if you test it with a live account. Additionally, to get the best of the Renko indicator, you shouldn’t use it in isolation. Combine it with at least 3 to 4 other technical indicators to increase your chances of winning in a trade.
Importantly, right here on our platform, we have a wide range of technical indicators and tools for you to give serious consideration. So check them out through this link and these indicators, like the Renko indicator, will help to improve your earnings and ultimately better position you on the market.
You can leave your feedback in the comment section below and let us know your experience with using Renko Indicator MT4.