Altough on the mt4 platform Heiken Ashi is included in the indicators list, it represent a different version of Japanesse candlesticks. It’s goal is to filter some of the noise that the traditional candlestick generate and to give a clearer picture of the price action and the order flow behind it.
Haiken Ashi – Close=(open(c) + high (c) + low(c) + close(c))/4
Haiken Ashi – Open=(Haiken Ashi-Open(c-1) + Haiken Ashi-close(c-1))/2
Haiken Ashi – High=Maximum of the high(c), Haiken Ashi-open(c) or Haiken Ashi-close(c)
Haiken Ashi – Low=Minimum of the low(c), Haiken Ashi-open(c) or Haiken Ashi- close(c)
Open(c), low(c), high(c) and close(c) represent the open, low, high and close of the current period.
In order to set it up on your mt4 platform, set the line chart first, then go to Insert – Indicators – Custom – Heiken Ashi :
As we mentioned, you can use Heiken Ashi as a replacement for the Japenesse candlestick, so you can use the same strategies and setups,only the candles on your chart would be different.
This is how your chart should look like: