The Renko Volume Confirmation Strategy is a highly visual and disciplined trading method that blends the clarity of Renko charts with the power of volume analysis to filter out market noise and confirm breakout or trend-following trades. By focusing on price action without time and using volume to validate movement strength, this strategy offers high-probability setups in both trending and volatile conditions.

This article breaks down how to apply the strategy, tools needed, trade setups, and practical tips to maximise accuracy.

**What Is the Renko Volume Confirmation Strategy?

Renko charts are constructed by price movement alone—not time. A new “brick” forms only when price moves a fixed amount, eliminating small fluctuations and presenting trends with exceptional clarity. When combined with volume confirmation (either tick volume or real volume), traders can verify the strength behind each move, improving trade confidence and reducing false signals.

This strategy is ideal for traders who want to:

• Simplify chart analysis
• Identify clean breakout and trend continuation trades
• Avoid choppy or indecisive markets

Core Components of the Strategy

1. Renko Chart

• Filters out minor fluctuations
• Helps identify clear support/resistance and trend structure
• Brick size can be set manually (e.g. 10 pips, $1, etc.) or based on ATR

2. Volume Indicator

• Used to confirm breakout strength
• Most commonly used: Volume (for real data) or Tick Volume (in forex)
• Spike in volume = increased conviction behind the move

3. Optional Add-ons

• RSI or MACD for divergence detection
• Moving averages for trend bias (e.g. 20 EMA and 50 EMA)

Trade Setup: Trend Continuation

Step 1: Identify the Trend on Renko Chart

• Look for a series of consecutive bricks in one direction
• Avoid entry during tight ranges or brick flip-flopping

Step 2: Wait for Pullback and Reversal Brick

• Entry after a colour change (e.g. red bricks in an uptrend)
• Wait for a new brick to confirm the trend resumes

Step 3: Confirm with Volume Spike

• Volume should increase as the new breakout brick forms
• Avoid trades on weak volume (low conviction)

Entry: On the breakout brick with confirming volume
Stop-Loss: One or two bricks beyond the entry point (depending on volatility)
Target: Use fixed reward (e.g. 2x risk) or exit after a reversal brick with low volume

Trade Setup: Breakout from Consolidation

Step 1: Identify Consolidation Zone

• Series of alternating bricks within a narrow range
• Price coiling with flat volume

Step 2: Wait for Breakout Brick and Volume Spike

• Entry on breakout from range with strong volume
• Volume should exceed the average of the previous 10–20 bars

Stop-Loss: One brick inside the range
Take-Profit: Measured move or 2x brick size

Best Markets and Timeframes

• Forex, Commodities, Indices, Crypto
• Suitable for intraday (M15/H1) or swing (H4/Daily) setups
• Brick size should reflect asset volatility (e.g. 10–15 pips in forex, $2–5 in stocks)

Advantages of the Renko Volume Confirmation Strategy

• Noise reduction: Renko charts eliminate indecision candles
• Clear entries and exits: Visual confirmation enhances decision-making
• High accuracy: Volume filters out weak breakouts
• Discipline-enforcing: Forces you to wait for confirmation

Common Mistakes to Avoid

• Ignoring volume: Breakouts without volume are prone to fail
• Using inconsistent brick size: Always base brick size on volatility or ATR
• Trading during sideways phases: Wait for clear directional movement

Conclusion

The Renko Volume Confirmation Strategy brings together the best of visual simplicity and technical accuracy. By using Renko charts to identify trend structure and volume to validate each move, traders can trade with enhanced confidence, cleaner setups, and improved discipline.

To learn how to implement this strategy with live charts and backtested setups, enrol in our expert-led Trading Courses at Traders MBA and discover how to combine price and volume into one of the most effective trading frameworks available today.