How to Trade the Range?

Trading the range is not as simple as merely buying and selling at the range extremes. At times, it does work in that manner — but most successful range traders use a combination of volume, candlestick patterns, liquidity analysis and moving averages to take advantage of rangebound environments.

Experienced range traders enter and exit positions around range extremes when their preferred analysis methods line up around these areas. The more indicators point in the same direction, the more confident the traders are.

For example, a range trader would likely enter positions on the liquidity grabs (marked red in the chart below); a short trade when the upside liquidity is taken, and a long trade when the downside liquidity runs out.