Post of the Day: Range Trading - Timing Entries

[B]Student’s Question:[/B]

Would you elaborate using a chart (if possible) on how to use an indicator (RSI preferably) to time an entry when using a Range Trading strategy?



[B]Power Course Instructor’s Response:[/B]



Remember that when trading a range, we want to buy (go long) at support and sell (go short) at resistance. So, when the pair is trading at resistance, the top of the range, we know that we plan to short the pair. To time the entry, we would look for the RSI, ideally, to be above 70. When the RSI breaks below 70 and closes below 70, that would be our opportunity to short the pair.

Take a look at the chart below for a visual on this plan…