Forex traders may wonder what forex range trading is. If they have made research on some forex charts, it is not difficult for them to find that there are times when they see the price moving up and down within a trend channel (please refer to the picture below). When the price is within a channel, we say that it is moving in a range bounded by an upper resistance and a lower support level. Forex range trading means buying and selling in the range.
Take a look at this chart. There are a support line at the bottom of the picture and a resistance line at the top of the picture. We can see that price bouncing up and down within support and resistance lines. The area created by the support and resistance lines is called a trend channel or a range in forex range trading. Range traders try to stay in the range. They usually buy at bottoms and sell at the tops. Thus, we can see that range traders usually trade in the support and resistance lines and they always trade relative short term in forex range trading.
How to get started in forex range trading?
Before forex range trading, what forex traders should do first is to choose proper currency pairs that have the biggest potential to bring profits in forex range trading.
Step 4 for forex range trading: don’t be greedy
It is beneficial to set goals for each trade and do not involve such emotions as greed in forex range trading. Just follow forex trading strategies and do not dream of being rich overnight. Avoid chasing break out because that is risky.
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