Using Renko Charts to Uncover SECRET Bank Levels

10月26日

Renko charting has a unique way of displaying price data by filtering out smaller fluctuations and focusing only on substantial price moves. With a setting of Average True Range (ATR) 13, Renko charts become even more powerful for finding key institutional levels—what many traders call "secret bank levels." These are the levels where large institutional traders place their orders, often leading to significant price moves. In this tutorial, we’ll dive into how you can use Renko charts with an ATR setting of 13 to identify these bank levels and improve your trading strategy.

What Are Secret Bank Levels?
Institutional or bank levels are price points where big players—like banks and hedge funds—are likely to buy or sell in large quantities. Retail traders can leverage these levels by understanding where the big money is moving, aligning their trades accordingly. Renko charts, with their clarity in price movement, help identify these areas by smoothing out noise and highlighting essential support and resistance zones.

Why Renko Charts?
Renko charts are designed to filter out minor price movements, providing a cleaner view of market trends by focusing solely on significant price changes. Unlike time-based charts, Renko charts print a new "brick" only when price moves by a specified amount, determined here by the ATR 13 setting. This brick-by-brick approach can reveal clear levels where price repeatedly finds support or resistance, often signaling where major institutions are setting up their positions.

Setting Up Renko with ATR (13)
Choose Your Charting Platform: Most charting software, including TradingView and MetaTrader, offers Renko charting. Make sure your platform supports Renko and ATR-based calculations.

Configure Renko with ATR (13):

Open the Renko chart on your selected asset (e.g., EUR/USD, GBP/USD).
In your settings, set the brick size to use the ATR indicator and specify an ATR length of 13. This setting is designed to adjust the brick size based on the recent average true range, capturing a balanced view of price movement.
This 13-period setting adapts to recent market volatility, allowing Renko bricks to reveal significant price movements that matter to large institutional players.

Adjust Timeframes:

Since Renko charts don’t follow traditional time-based intervals, switch between higher and lower timeframes (like the 1-hour or 4-hour charts) to observe different levels of institutional interest. Higher timeframes generally provide more reliable secret bank levels, but you can switch to lower timeframes for refined entry points.
Identifying Bank Levels with Renko and ATR (13)
Now that your chart is set up, let's move on to the process of identifying institutional levels.

1. Look for Brick Clusters at Key Levels
Renko bricks tend to form clusters at significant institutional levels. When you see several bricks stacked horizontally with little movement, it often indicates a zone where price is struggling to break through, either as strong support or resistance.
Use these clusters as potential entry or exit points, aligning with the institutional flow.
2. Identify Breakouts and Rejections
When price breaks out of a cluster or encounters rejection (where bricks reverse direction after hitting a level), you may be witnessing bank-level reactions.
Watch for bricks that quickly shift direction after hitting a level—these can signal that institutions have stepped in to either push price further or halt its momentum.
3. Note Patterns and Reversals at Round Numbers
Banks and institutions often place orders at round numbers, which are psychologically significant levels (like 1.2000, 1.2500).
As Renko charts with ATR (13) are sensitive to significant price changes, they can help highlight when price respects or bounces off these round numbers, offering clues to potential institutional zones.
Practical Example: Trading Secret Bank Levels with Renko
Let’s say you’re analyzing EUR/USD on a Renko chart with an ATR 13 setting.

Identify Clusters at 1.2000: After setting up your chart, you observe a cluster of Renko bricks at 1.2000, indicating a strong support zone. This level has held multiple times, suggesting institutional buying interest.

Wait for a Brick Breakout: You then see price breaking out with consecutive Renko bricks closing above 1.2000. This breakout suggests that the buying pressure might push prices higher.

Enter and Manage Your Position:

Take a buy position after confirming the breakout. Set your stop loss just below the cluster at 1.1980 to minimize risk.
If you’re looking for a shorter-term position, aim for profit at the next round number, like 1.2100.
For a longer-term trade, follow Renko’s direction, adjusting your stop as the bricks move.
Tips for Trading Bank Levels with Renko and ATR (13)
Trust Your Levels: Renko charts can simplify your analysis, but it’s easy to second-guess your levels. If you’ve identified strong clusters or patterns at certain price points, trust your analysis.

Use Alerts to Avoid Over-Trading: TradingView and other platforms allow you to set alerts at specific price levels. This way, you won’t need to stare at charts all day.

Thank you for watching and feel free to leave a comment to let me know your thoughts on Renko and if you see yourself using this chart type.
-TL Turner