Drawing Close-Based Renko Boxes on a Price Chart
Summary
The document presents a price-chart indicator that approximates Renko boxes using closing prices. It initializes upper and lower box boundaries, then shifts them when the close moves beyond a threshold based on twice the configured box size. Otherwise, the existing boundaries remain in place. The output is the current top and bottom of the box, intended to make price movement easier to view without plotting conventional time-based candles alone.
Because the calculation uses only closing prices, the author advises waiting for the current candle to finish before acting on a newly formed box. They also suggest creating another version based on candle highs and lows. The document does not define a trading strategy, entry or exit rules, or performance evidence. Its example is therefore a visualization method, and box behavior depends on the chosen size and instrument tick size.
Key ideas
- The indicator tracks upper and lower Renko-like boundaries using closing prices.
- A boundary shifts when the close crosses a threshold tied to twice the box size.
- A signal should be assessed after the current candle closes because intrabar prices are not used.
- A separate implementation using candle highs and lows is suggested, but no trading results are given.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.