What is a Renko chart?
In one line: A Renko chart draws same-size bricks that only form when price moves a set amount, so it ignores time and small wiggles and shows only bigger moves.
How bricks form
You choose a brick size, say $1.
- Price must move $1 past the last brick's top for a new up brick.
- In most Renko charts, price must move $2 the other way (2 bricks' worth) to start a down brick.
- Moves smaller than that draw nothing, no matter how long they take.
Time disappears. One brick might take 5 minutes. The next might take 3 days.
A simple example
Brick size $1. The last brick closed at $50.
- Price goes to $50.60. No new brick.
- Price goes to $51.10. One up brick, $50 to $51.
- Price goes to $53.20. Two more up bricks, to $53.
- Price drops to $51.80. No new brick. It needs $51.00 or lower to draw a down brick from $52 to $51.
All the back and forth between $51 and $53 is gone from the chart.
Picking a brick size
- Fixed: you set a number, like $1 or 10 pips.
- ATR-based: the brick size follows the market's average range. See ATR.
Too small and it looks like a normal noisy chart. Too big and it hides most of what happened.
Why it matters
Renko makes a Trend look very clean. Lines of same-color bricks are easy to read, and turning points stand out.
A common mistake
Testing strategies on Renko charts. Bricks only appear after a full move, and the brick's price often isn't where you could have traded. Results tested on Renko can look far better than real life. Also, the newest brick isn't final until it completes.
Use Renko to see the bigger picture, then plan trades on a normal time-based chart where every price is real.
Our guide to reading stock charts compares the main chart types. For a smoothed view that keeps time, see Heikin Ashi.
Questions
What is the best brick size for Renko?
There's no single best. Many people use an ATR-based size so the bricks match how much the market usually moves. A fixed size works for one market at a time.
Does Renko show time?
No. The x-axis on a Renko chart is not time. A brick forms only when price moves enough.
Can I use Renko on TradingView?
Yes. It's in the chart type menu. You can pick a fixed brick size or an ATR-based one.
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