A UNIQUE STRATEGY FOR TRADING ON A RANGE-BOUND MARKET

This strategy will teach you to trade with cross pairs in a market where price bounces between high and low extremes.

Timeframe: all

Currency pairs: cross pairs

Market state: range-bound

Traders can use the range-trading strategy when the market has no clear trend. Range-bound or a sideways trend can happen with any currency, but it is particularly widespread in popular cross pairs, such as AUDNZD, GBPCAD, and EURGBP.

After finding a range-bound market where prices fluctuate between two extremes, traders should identify the support (green line) and the resistance (red line) and measure the difference between the two.

Required indicators:

  • There are no specific indicators. However, you can use Bollinger Bands to find a range-bound market and apply Stochastic (21, 1, 3) as an auxiliary indicator to find entry and exit points.

Entry conditions for a short position (Sell):

1. Price is trading near the resistance line.

2. The stochastic is above 70.

Stop Loss

The Stop Loss level will be the difference between support and resistance levels divided by three.

Take Profit

Take your profit when the price is approaching the support zone.

Entry conditions for a long position (Buy):

1. Price is trading near the support line.

2. The stochastic is below 30.

Stop Loss

The Stop Loss level will be the difference between support and resistance levels divided by three.

Take Profit

Take your profit when the price is approaching the resistance zone.

Follow our instructions, and you will easily predict the cross pairs price movements even during the sideways trend. Trade carefully!

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