Having a hard time understanding trading ranges?
Check this out! ๐งต
Check this out! ๐งต
The trading range is simply the difference between a market's highest and lowest price in a given period of time.
After having a good understanding of the current market trend, understanding ranges will help in identifying where price in the market has been trading and help you buy low and sell high.
IN A BEARISH SCENARIO
After every sweep of liquidity and then a break of structure, the high which swept liquidity becomes the strong high and the new low created is a weak low. Now the new trading range at that particular period is from the strong high to the new low created.
After every sweep of liquidity and then a break of structure, the high which swept liquidity becomes the strong high and the new low created is a weak low. Now the new trading range at that particular period is from the strong high to the new low created.
IN A BULLISH SCENARIO
Same goes for here but in this case, the sweep of liquidity is carried out by a low and then the new high breaks structure. The point from the strong low to the new(weak)high now becomes the new trading range.
Same goes for here but in this case, the sweep of liquidity is carried out by a low and then the new high breaks structure. The point from the strong low to the new(weak)high now becomes the new trading range.
For every trading range to be complete, price has to sweep liquidity and then break structure.
Every range has three points:
Premium level
Equilibrium level
Equilibrium level
Every range has three points:
Premium level
Equilibrium level
Equilibrium level
To mark out these levels you can make use of either the GANN BOX TOOL or FIB tool on HTFs then scale down to LTFs for executions.
In a bearish case, after identifying your range, mark out your levels, you'd want to sell above the equilibrium level (premium price), spot liquidity resting above this level and have your entry using a POI or entry on liquidity.
In the bullish case, after identifying your new range and marking out your levels, you'd want to buy below the equilibrium level (discount price), spot the liquidity resting below the level and have your entry using a POI or entry on liquidity.
Remember price in the Forex market is fractal, so whatever structures you see on HTFs you can see on LTFs, so you can make use of ranges to your advantage on any time frame. Advisable you make use of HTF ranges to build up your analysis/story.
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@Techriztm
@Order_Flow_godd
for more eductive contents.
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