The LogikRenkoStreamline is an improved variant of the traditional Renko BarType. Features include
- True Wick Display
- Close To Open Reversal Display
- Reversal Brick Size Control
- Automatic Adaptive Brick Size (NT8)
True Wick Display
The LogikRenkoStreamline can depict the true High / Low with a candle chart like wick to reintroduce this important price information lost with the traditional LogikRenko bar, while maintaining the benefit of isolating the underlying price trend. Wick display benefits include:
- Large wick-to-brick ratio illustrates strong indecision
- Small wick-to-brick ratio illustrates little to no indecision
- Congestion areas can be analyzed more efficiently
- A wick can be utilized to determine an dynamic trail
- A wick can be utilized to determine S/R areas
CloseToOpen Reversal Display
The Open price of the reversal brick is traditionally the same as the Open of the previous brick. This is not the TrueOpen price of a reversal brick, and is NOT backtestable in NinjaTrader with any degree of accuracy.
When a reversal brick is created, the Open of the reversal bar should paint at the previous brick Close. To properly depict this, the CloseToOpen implementation sets the Open of the reversal brick to the Close of the previous brick. Although this may not be as visually appealing to some, it represents the TrueOpen of the reversal, as well as properly performs a buy / sell at next bar open strategy order during a strategy back-test execution.
Reversal Brick Size
Renko bar computations are defined comparing the current tick price to the price of the close price of the last brick. A new brick is created in the same direction of the current brick if the tick price moves the BrickSize amount in the same direction. However, if the price moves (2) times, or the ReversalBrickSize amount of the BrickSize from the close of the previous brick, an opposite direction (reversal) brick is created.
A powerful modification allows the trader to more clearly and accurately depict the trend direction and to minimize spurious reversal whipsaws, by allowing for the increase in the ReversalBrickSize. This is illustrations below show various ReversalBrickSize settings.
Adaptive Brick Size (Daily Basis)
The LogikRenkoStreamline has the ability to dynamically determine the appropriate brick size to best adapt to market conditions. The unique algorithm constantly monitors market data on a tick by tick basis to self tune the brick size throughout the day. At the beginning of each new day the computed brick size is automatically implemented to the chart. An indicator (below) is include for this computation.