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Heikin Ashi chart: how it works and how to read it, free online

What a Heikin Ashi chart shows, how its candles are calculated, how to read trends and reversals, and how to use it free in SuperCharting.

A Heikin Ashi chart draws averaged candles instead of raw prices, so trends show up as long runs of one colour and small pullbacks disappear. It is a chart type, not an indicator: you switch the whole chart to it. In SuperCharting it is in the chart type menu with the other types, free on every account, and it works on any symbol and interval, from NSE:NIFTY 5m to BTCUSD 1D.

How Heikin Ashi candles are calculated

"Heikin Ashi" is Japanese for "average bar". Each candle is built from the real candle and the previous Heikin Ashi candle:

• HA close = (open + high + low + close) / 4
• HA open = (previous HA open + previous HA close) / 2
• HA high = the highest of the real high, the HA open and the HA close
• HA low = the lowest of the real low, the HA open and the HA close

Because each open depends on the candle before it, a Heikin Ashi candle carries some of the past into every bar. That is what smooths the chart, and it is also why Heikin Ashi reacts later than normal candles.

A worked example

Say a NIFTY 15m bar opens at 24,500, makes a high of 24,560 and a low of 24,480, and closes at 24,540. The previous Heikin Ashi candle had an open of 24,470 and a close of 24,510.

• HA close = (24,500 + 24,560 + 24,480 + 24,540) / 4 = 24,520
• HA open = (24,470 + 24,510) / 2 = 24,490
• HA high = 24,560 and HA low = 24,480

The candle is green, because the HA close is above the HA open. Its body runs from 24,490 to 24,520, even though the real market closed at 24,540.

How to use a Heikin Ashi chart in SuperCharting

1. Open a chart, for example NSE:BANKNIFTY on the 15m interval.
2. Click the chart type button in the top toolbar. Its tooltip names the current type, for example Candles.
3. Choose Heikin Ashi.
4. To change colours, click Settings (the gear in the top toolbar) and open the Symbol tab. The Heikin Ashi section has the same body, border and wick colour choices as normal candles.
5. In a multi-chart layout you can keep one chart on candles and set the one next to it to Heikin Ashi. You then see the smoothed trend and the real prices side by side.

By default the last-price label on the price scale shows the real market close, not the averaged one, so you know where price actually is. To show the Heikin Ashi close there instead, open Settings > Symbol and switch off Real prices on price scale (instead of Heikin-Ashi price).

How to read Heikin Ashi

These are common ways traders read the chart. They describe the chart, not a reason to buy or sell.

• Strong uptrend: a run of green candles with no lower wicks. Price did not trade below the averaged open, so buyers kept control.
• Strong downtrend: a run of red candles with no upper wicks.
• Weakening trend: bodies get smaller and wicks appear on both sides. That is often the first sign that the run is slowing down.
• Possible turn: a small body with long wicks on both sides (similar to a doji), followed by a candle of the other colour.
• Range: colours alternate every few candles. Heikin Ashi signals work poorly here, as most trend tools do.

Combining it with other tools

Many traders use Heikin Ashi only to judge direction and take entries from something else. For example: trade long only while Heikin Ashi is green, and use the Supertrend indicator or a moving average for the stop. Another common setup is a Heikin Ashi chart on a higher interval (1h) next to a normal candle chart on a lower one (5m).

What to watch out for

• The prices are not real. An HA close is an average. Do not use it to place a stop or a limit order. Use the price scale, the real-price label, or a candle chart.
• Gaps disappear. Heikin Ashi smooths over opening gaps. That is misleading on NSE stocks that gap at 9:15, so check the real candles before you act on the open.
• It lags. Because each candle includes the previous one, a reversal shows up a candle or two later than on normal candles.

Indicators, strategies and alerts on a Heikin Ashi chart

In SuperCharting, indicators, strategies and alerts always run on the real prices, whatever chart type you display. An RSI or a moving average gives the same values on Heikin Ashi as on candles. A backtest in the Strategy Tester fills orders at real prices, so the results are not flattered by averaged candles.

If you want a script to use Heikin Ashi values, there are two ways. The short one is request.security(ticker.heikinashi(syminfo.tickerid), timeframe.period, close), which returns the Heikin Ashi close of each bar; a higher timeframe such as "W" works too. The other is to calculate the candles in the script, which keeps every step visible. This indicator does that and marks the bar where a run of one colour reaches the length you choose:

//@version=6
indicator("Heikin Ashi trend", "HA trend", overlay = true)
minRun = input.int(3, "Candles in a row", minval = 1)
haClose = (open + high + low + close) / 4
var float haOpen = na
haOpen := na(haOpen[1]) ? (open + close) / 2 : (haOpen[1] + haClose[1]) / 2
haGreen = haClose >= haOpen
greenRun = ta.barssince(not haGreen)
redRun = ta.barssince(haGreen)
turnUp = haGreen and greenRun == minRun
turnDown = not haGreen and redRun == minRun
barcolor(haGreen ? color.new(color.green, 60) : color.new(color.red, 60))
plotshape(turnUp, "HA turned up", shape.triangleup, location.belowbar, color.green)
plotshape(turnDown, "HA turned down", shape.triangledown, location.abovebar, color.red)
alertcondition(turnUp, "Heikin Ashi turned up", "Heikin Ashi printed a run of green candles")
alertcondition(turnDown, "Heikin Ashi turned down", "Heikin Ashi printed a run of red candles")

Save it in the Script Editor, add it from My scripts in the Indicators dialog, and create an alert on Heikin Ashi turned up or Heikin Ashi turned down from its legend menu. Set the alert to Once per bar close, because the live candle can still change colour before it closes. To write your own variations, start with the Pine-compatible basics.

To backtest the same idea, turn it into a strategy with strategy.entry on those two conditions and test it with commission and slippage set. Past results do not guarantee future results.

Heikin Ashi compared with Renko

Both smooth price, in different ways. Heikin Ashi keeps one candle per time interval and averages it. Renko ignores time and draws a new brick only when price moves a set amount. Heikin Ashi is easier to line up with clock times and sessions. Renko filters small moves harder but hides how long a move took. The chart types guide compares all of them.

Frequently asked questions

Is Heikin Ashi free in SuperCharting?

Yes. SuperCharting is currently free, and every chart type, Heikin Ashi included, is available on every account.

Why does the Heikin Ashi close differ from the real close?

The Heikin Ashi close is the average of the bar's open, high, low and close, not the last traded price. The price scale's last-price label shows the real close unless you switch off Real prices on price scale in Settings > Symbol.

Do indicators calculate on Heikin Ashi prices?

No. They use the real prices, so they give the same values on any chart type. To work with Heikin Ashi values, request them with ticker.heikinashi() or calculate them in a script, as shown above.

Which interval works best for Heikin Ashi?

There is no single best one. Intraday traders often use 5m to 15m for NIFTY and BANKNIFTY, and swing traders use 1h to 1D. Test any setup on your own symbol before relying on it.