Price action and chart patterns
Range trading
Price moves sideways between a clear ceiling and floor, touching both several times without breaking out.
Why it works
In a range there is no trend to follow, but the edges are predictable: buyers defend the floor and sellers the ceiling.
How to use it
Buy near the bottom and sell near the top, with stops outside the range. Stop range-trading as soon as a candle closes outside.
The typical mistake
Buying or selling in the middle of the range, where the risk-reward is worst.
FAQ
What is Range in trading?
Price moves sideways between a clear ceiling and floor, touching both several times without breaking out.
How do you trade Range?
Buy near the bottom and sell near the top, with stops outside the range. Stop range-trading as soon as a candle closes outside.