Filed Under:
Tickers in this Article:
For today's chart we've chosen to take a look at the renko chart of CI. This type of chart is not commonly used by beginner traders, but as you will see here, it can be very interesting. Renko charts are constructed by plotting a number of boxes, also known as bricks, onto a chart. Each unfilled brick is used to illustrate a rising price, while the dark bricks represent a falling price. Each brick is placed onto the chart once the price moves above the high or low of the current brick by more than a preset box size. It is important to note that this type of chart only deals with price movement and is not contingent on the passage of time. Technical traders use this type of chart to identify major trends and key support/resistance levels by filtering out day-to-day price moves.

As you can see from the chart below CI is in the process of testing the resistance of $131.75, which is a level that has prevented the price from moving higher in the past. Now that the boxes are approaching the previous resistance, traders will start to watch for the appearence of a black brick to signal the chance of a trend reversal.


comments powered by Disqus
Trading Center