the, nR4 bar forex trading strategy is a price action trading system that is based on todays high to low price range that must be narrower than the previous 3 days. On closer observation, one can see that numerous trading strategies that are unique to Range bars can be developed. Trading on the daily chart means that profit potential of this system is not on 10 of pips but 100-300 or even more and that depends on how strong the market trend is as well as how strong your never is to let your profit. If youve enjoyed this narrow range 4 bar trading system, please dont forget to share, like, tweet or even mention it on other forex websites should when you have the opportunity. Its a visual thingand this may sometimes cause a few issues for new traders and you can miss excellent trading setups that form. The best place to use the narrow range 4 bar for buying are: support levels where price is showing downward weakness by forming the NR4 bar like shown on the chart below. Because range bars consider only price, the main variable when setting up the range bars is the price level. There will be times when there will be false signals, when you will see price active your pending order and you think a breakout has happened but than it reverses and will take out your stop loss.
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Traders can make use of one of the many available range bar EAs in order to build these charts and trade off them. Unlike the more conventional chart types such as the candlestick and bar charts, with Range bars, only the horizontal price level is plotted. For example, a 10 pip range bar will define that every bar has a range of 10 pips when measured from high to low. However, most of the existing trading platforms have not yet incorporated the range bars as one of the default chart types. The above chart shows a 10 pip eurgbp range bar. Three Price Chart Types That You Should Start Using.
Although relatively new when compared to the other chart types, range bar based trading strategies and analysis have quickly caught. The buy setup for the narrow range 4 bar are exact opposite of the sell setup youve read above: identify the narrow range 4 bar on your daily chart place a buy stop pending order 2 pips above the high of the NR4 bar place. With time not coming into the equation, a range bar can continue to unfold until price breaks above the range.