{"id":1170,"date":"2023-08-24T00:45:19","date_gmt":"2023-08-23T19:15:19","guid":{"rendered":"https:\/\/www.definedgesecurities.com\/trading-strategies\/?p=1170"},"modified":"2025-07-16T21:51:13","modified_gmt":"2025-07-16T16:21:13","slug":"major-reversal-patterns-on-renko-chart","status":"publish","type":"post","link":"https:\/\/www.definedgesecurities.com\/trading-strategies\/major-reversal-patterns-on-renko-chart\/","title":{"rendered":"Renko Reversal Patterns"},"content":{"rendered":"<p data-start=\"76\" data-end=\"152\">Renko chart patterns consist of <strong data-start=\"108\" data-end=\"151\">unique breakout and reversal formations<\/strong>.<\/p>\n<p data-start=\"154\" data-end=\"218\">Below are some of the major <strong data-start=\"182\" data-end=\"217\">bullish Renko reversal patterns<\/strong>:<\/p>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul data-start=\"220\" data-end=\"312\">\n<li data-start=\"220\" data-end=\"249\">\n<p data-start=\"222\" data-end=\"249\"><strong data-start=\"222\" data-end=\"247\">Bullish Weak Breakout<\/strong><\/p>\n<\/li>\n<li data-start=\"250\" data-end=\"277\">\n<p data-start=\"252\" data-end=\"277\"><strong data-start=\"252\" data-end=\"275\">Bullish Strike Back<\/strong><\/p>\n<\/li>\n<li data-start=\"278\" data-end=\"312\">\n<p data-start=\"280\" data-end=\"312\"><strong data-start=\"280\" data-end=\"312\">Bullish 123 Pullback Pattern<\/strong><\/p>\n<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p>Below is a possible Renko reversal strategy in the Momentify Trading setup.<\/p>\n<p><strong>Strategy Name:<\/strong> Renko Reversal Patterns<\/p>\n<p><strong>Stock Group:<\/strong> Your choice<\/p>\n<p><strong>Allocation:<\/strong> Your choice<\/p>\n<p><strong>Number of Stocks:<\/strong> Your choice<\/p>\n<p><strong>Rank Criteria:<\/strong> Volar<\/p>\n<p><strong>Position Size:<\/strong> Fixed<\/p>\n<p><strong>Ranking Period:<\/strong> 252<\/p>\n<p><strong>Retracement:<\/strong> Within 80% of 52-week high<\/p>\n<p><strong>Moving Average Filter:<\/strong> 200-EMA<\/p>\n<p><strong>Entry Condition:<\/strong> Major Renko Reversal Patterns (1%) and Above D Smart (3%)<\/p>\n<p><strong>Exit Condition:<\/strong> Below D Smart<\/p>\n<p><strong>Market Trend Filter:<\/strong> Change the exit strategy to Bearish Swing breakout when Nifty turns bearish, or when X% breadth rises above 75, or X% breadth falls below its moving average.<\/p>\n<p><strong>Please note:<\/strong> When using Renko charts, the brick-value can be defined based on the stock universe:<\/p>\n<ul>\n<li><strong>0.50% x 3<\/strong> for large-cap stocks<\/li>\n<li><strong>1% x 3<\/strong> for other stocks<\/li>\n<li><strong>3% x 3<\/strong> for medium- to long-term trading setups<\/li>\n<\/ul>\n<p>You can run this strategy on large-cap, mid-cap, small-cap, micro-cap, or the entire market universe. It can also be applied to various sectors, thematic indices, or even your own custom group of stocks.<\/p>\n<p>In the above template, position sizing is kept as <em>fixed<\/em>. However, you can also opt for ATR-based or Risk-based position sizing methods.<\/p>\n<p>It is important to understand that the above rules are meant to help you understand the structure of the template. <strong>You are encouraged to tweak the parameters as per your comfort<\/strong>, and backtest across different time periods and stock universes to build your own customized trading template.<\/p>\n<p>You can customize the exit strategy \u2014 including setting your preferred stop-loss percentage and target levels.<\/p>\n<p>You can use this base template, make necessary adjustments, and save it in your <strong>Momentify Trading dashboard<\/strong>.<\/p>\n<p>To backtest your strategy, go to:<br \/>\n<strong>RZone \u2192 Backtesting \u2192 Momentum Trading Backtesting<\/strong><\/p>\n<p>The above strategy in the Momentify Trading Setup is a long-only (buy-only) strategy and can be applied across any market segment \u2014 cash or derivatives, across any timeframe or instrument.<\/p>\n<p>In Momentify trading setups, there are two options: Fresh and Running.<\/p>\n<ul>\n<li><strong>Running:<\/strong> Displays stocks that qualified earlier and are still running in the same column. These stocks are ranked based on the selected ranking criteria.<\/li>\n<li><strong>Fresh:<\/strong> Shows only those stocks that qualify the setup on the current day, also ranked based on the selected criteria.<\/li>\n<\/ul>\n<p class=\"pb-2\" data-private=\"redact\" data-wt-guid=\"c3a33be0-db7f-4ab2-9074-8c3cd4384376\">The stock basket in Momentify is generated based on the previous session\u2019s closing price.<br \/>\nTo scan stocks using live market prices, simply click the <strong>Scan<\/strong> button.<\/p>\n<p class=\"MsoNormal\">\n","protected":false},"excerpt":{"rendered":"<p>Renko chart patterns consist of unique breakout and reversal formations. Below are some of the major bullish Renko reversal patterns: Bullish Weak Breakout Bullish Strike Back Bullish 123 Pullback Pattern Below is a possible Renko reversal strategy in the Momentify Trading setup. Strategy Name: Renko Reversal Patterns Stock Group: Your choice Allocation: Your choice Number &#8230; <a title=\"Renko Reversal Patterns\" class=\"read-more\" href=\"https:\/\/www.definedgesecurities.com\/trading-strategies\/major-reversal-patterns-on-renko-chart\/\" aria-label=\"More on Renko Reversal Patterns\">Read more<\/a><\/p>\n","protected":false},"author":3,"featured_media":1311,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[18,27,16],"tags":[],"class_list":["post-1170","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-pullback-trading-strategy","category-renko","category-reversal-trading-strategy"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v21.4 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Renko Reversal Patterns - Trading Strategies<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.definedgesecurities.com\/trading-strategies\/major-reversal-patterns-on-renko-chart\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Renko Reversal Patterns - Trading Strategies\" \/>\n<meta property=\"og:description\" content=\"Renko chart patterns consist of unique breakout and reversal formations. 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