stock market in hyderabad
Trading Range Definition & Trading Strategies

Typical characteristics of Trading Range Market:

• No-Gap Opening or Gap opening in yesterday’s range
• Day start with Doji bars / overlapping bars
• Multiple early reversals in 1st hour
• Relatively big opening Range (more than 50 % of ATR)
• Prior few days are sideways days
• Several changes in the direction of the move (Sense of uncertainty, 50-55%)
• Mostly, overall price action is Horizontal
• Move to continue with a lot of overlapping bars
• It looks like the range is about to BO, but it fails most of the time
• Sharp reversals near Top and Bottom of Trading Range (vacuum effect)
• EMA is relatively flat
• The market runs the stops repeatedly
• Most of the patterns are Trading ranges

Additional essential points while trading in Trading Range Market :

Most Trading Ranges are continuation patterns
Most reversal patterns are trading ranges
Longer the TR continue, greater are the odds that it will become a reversal pattern.
It is usually a trend resumption setup of higher TF
Rallies tend to be stronger than the pullback in TR in the bull market especially when TR near ends
Regularly, next day follow through with TR
80% of the time, Trading Range Breakouts /Breakdowns fail

Trading Strategy in Trading Range Market:

Buy low- sell high (BLSH) setup to trade (Trading Breakout Failures (or) 2nd Signal Trade at Trading Range Boundaries)
Try to Scalp (1 R profit). If the trading range is big, try to swing part positions.