Stuck in a range? Trade the box

Price going nowhere for days? That's not a problem.

It's a box. And a box can be traded.

Step one. Mark the top and the bottom. You need two touches on each.

On this euro chart, the bottom held twice, near 1.1359.

And the top stopped price twice, at 1.1411.

Now you have a box. Step two. Buy near the bottom, sell near the top.

Buyers stepped in at the bottom, and price ran to the top.

Sellers took over at the top, and price fell back to the bottom.

Never trade the middle. From there, your stop and your target are the same distance away.

Put your stop just outside the box. Below it for a buy, above it for a sell.

Step three. A close outside the box ends the range trade.

Here, wicks poked below, but the candles closed back inside. The box still held.

Then candles closed below the bottom. The box was done. Stop trading it as a range.

Save this. Two touches on top and bottom. Buy the bottom, sell the top, skip the middle. A close outside ends it.

Your turn. Price is in the middle of this box. Buy, sell, or wait? Comment below.

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