Learn how to scalp index futures on the NinjaTrader platform using the renko optimizer

Learn how to scalp index futures on the NinjaTrader platform using the renko optimizer

In this video you will discover how to scalp emini index futures on the NinjaTrader platform using multiple versions of the renko optimizer indicator. It is a powerful approach and when used in conjunction with the equivalent time based charts also gives you the option to apply volume price analysis to the trading decisions.

00:11

Using Renko with multiple time frames

00:11

The speaker explains the use of multiple time frames in trading by combining Renko charts with time-based charts. They highlight the transition from a congestion and volatility phase to analyzing Renko charts as an additional tool, emphasizing the benefit of blending multiple Renko charts across different time frames to better apply volume and price analysis.

00:40

Advantages of Renko over time charts

00:40

The speaker discusses the benefits of using Renko charts for trading, highlighting that unlike time-based charts, Renko charts focus on momentum and smooth out congested price action by using bricks instead of candles. This results in more consistent trends. However, they emphasize the importance of candles to analyze Volume Price Analysis (VPA), which provides critical insights not available from Renko charts alone.

01:13

Optimizing Renko brick sizes

01:13

The speaker demonstrates updating the timing to the correct frame and explains how the optimizer calculates the optimal brick size. They show that the optimizer recommends an 8-point brick size, costing $40 per brick, and then apply the same optimization to a 30-second segment, confirming the optimizer’s assessment.

01:45

Brick size changes with time frame speed

01:45

The speaker explains how to choose a brick size for trading based on the time frame. For a twelve brick size, each brick represents twelve points and is worth $60. Moving to a one-minute time frame, an eighteen brick size is used, equating to ninety dollars per brick. The general rule is that faster time frames require smaller brick sizes, while slower time frames need larger brick sizes. Users can set brick sizes manually or use an optimizer, which is recommended as it is designed to find the optimal setting for a specific contract and time of day, whether trading wire or index futures.

02:40

Renko works across various contracts

02:40

The speaker explains that the system applies to various trading instruments, including commodities like gold and oil, soft commodities, and currency futures. It automatically provides the correct notation and annotation for each specific contract, such as dollars per ounce or bushels, ensuring accurate representation based on the contract being traded. The system typically involves two or three key indicators that are always active.

03:09

Trend dots indicating market direction

03:09

The segment explains the behavior of trend dots in relation to market movements. The trend dots closely follow price action, shifting colors to indicate bullish or bearish phases. Despite minor reversals and congestion phases that cause flickering, the trend monitor remains stable, especially after breaking out of congestion. The dots typically change before the trend monitor, reflecting immediate price shifts, and their position relative to price indicates the strength and direction of the trend.

04:00

Combining indicators for trend confirmation

04:00

The explanation covers the technique of applying pressure from the bottom or using prime support underneath bricks, emphasizing a combination of these methods. It also introduces the accumulation distribution indicator, which highlights strong regions on time-based charts and functions similarly on Renko charts, signaling important breakout points.

04:24

Support and resistance on Renko charts

04:24

The speaker discusses a strong support platform and resistance levels that have turned into support. They highlight breaking through a significant resistance region and mention various indicators such as trend dots and the Trem Bond trend monitor that help maintain trend direction. The Renko charting method is praised for smoothing price action, making it a powerful tool for trading. The speaker also notes that VP methodology can be applied for trading decisions on different timeframes before passing back to Anna.

By Anna Coulling – creator of volume price analysis