Zerodha Renko Kite chart

Renko brick retracement on Kite

From WebNotes, a public knowledge base. Last updated 19 May 2026. Reading time ~3 min.

Renko bricks on Kite plot a new brick only when price moves by the specified brick size in the same direction or reverses by 2x brick size. The retracement behaviour, where price moves a small amount against the trend without producing reverse bricks, is a key Renko characteristic.

Renko brick rules

A new up-brick is plotted only when price closes above the prior brick’s high by the brick size.

A reversal down-brick is plotted only when price moves down by 2x brick size from the prior up-brick’s low.

Small retracements (less than 2x brick) don’t create new bricks; the chart shows no movement.

What this looks like

Example with 10-point brick on a stock:

Brick 1: 100-110.
Brick 2 (up): 110-120.
Brick 3 (up): 120-130.

Now price retraces from 130 to 115 (15-point retracement, less than 2x = 20-point threshold). No new brick. Chart still shows the latest brick at 120-130.

Price then continues down to 105. Now the 2x threshold (20 points from 130) is exceeded. A down-brick is plotted, but only when the threshold is fully cleared.

Brick size choice

Brick size determines Renko sensitivity:

Small brick: more bricks, more noise filtered out per brick but more reversals.
Large brick: fewer bricks, smoother but coarse.

Kite allows brick size customisation. Common choices:

For stocks: 0.5-2% of price.
For Nifty: 50-100 points.
For Bank Nifty: 100-200 points.

Brick size methodology

Two methods:

ATR-based: Brick size = N x Average True Range. Adapts to volatility.
Fixed: User-specified absolute brick size.

Kite supports both. ATR-based is more popular for adaptive analysis.

Implications for technical analysis

Renko charts smooth out small retracements:

Trend-following strategies benefit from this smoothing.
Mean-reversion strategies (which trade on retracements) don’t work well on Renko.
Stop-loss placement: typical convention is 2 bricks against the current trend.

External references

References

Zerodha support documentation on Renko.
Varsity technical analysis module on Renko.
Steve Nison’s references on Japanese candlestick variants.

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Last reviewed: 19 May 2026
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