Trading made simple with Renko Charts (G-X Norway ETF Example)

Thought of making a post every now and then which shows how simple and stress free it is trading with Renko Charts.

Here's the G-X Norway ETF

Renko Charts - Price Action Case Study

I know in hindsight things look easy, but let's ignore the entire leg of the renko brings and focus on leg 1.

We see a strong trending market and then a series of down (red) reko bars. Plotting using the Fib tool, we get 14.25 as 38.2% retracement level. The first retracement fails to retrace to 38.2% and rallies, only to make a lower high, indicative of a losing momentum. This would have been the first signal. After a small pullback to the decline, we see a continued downtrend... and where does price retrace to?? Voila 38.2% of the leg 1 at 14.25.

Price then rallies until it makes a lower high. So we plot the next leg with Fib. The retracement here was quick and swift, with price reversing bang at 61.8% Fib, 15.26. Further confluence comes from the trendline holding.

Sure, between 14.25 and the drop to 15.26, it would have been just a 7% growth compared to the peak of 18%. However, with a bit of patience and objectivity, a trader could have purchased again at 15.26 thus increasing their equity even more.

Goes to show how simple it is to trade with Renko charts.

Interested to learn more about Renko? Click here.