Buying and Selling within Range or Trending Markets

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The last few weeks have been pretty crazy for me but not necessarily because of what was happening in the market. Instead, I had some major lifestyle changes that affected me both mentally and physically.

Before I went on a two-week break, which was conveniently arranged during Easter Break I did a very detailed 2 hours webinar type of session with the members. If you have not watched it and you are a member then I highly recommend it. I am going through a great transformation internally and I would like to share it with you. In this video, I share with everyone whatever that I have learned so far in my trading journey. A Journey that started initially somewhere around 2006. Today I’m going to share with you How to trade trending or sideways markets.

The TWO NEW Trading Strategies

I recorded two sessions each 1 hr long. The 1st is called The New Scalping Method – Lobot 2.0 and the 2nd is called The NEW Forex Swing Trading Method. (all Premium Memebers have access to it. )

The purpose of both sessions was to share two trading strategies that I will be using for my day trading from this point onward. The first part is about my NEW Trading plan for Day Trading The Stock Indices. The 2nd part is about trading the Forex Market. This session gives away my method of swing trading forex markets on the hourly chart.

I trade the Germany 30 or DAX 30 at the London Open and US30 or Wall Street or the Dow 30 during the New York Equities Open. Different brokers have different names for these indices but they are essentially the same markets.

If you’d like to watch all three sessions then log in to your account (Login Above) and go to your dashboard. You will find these three sessions under the tab

How to buy or sell when day trading stock indices. Day trading or scalping the stock indices can be highly lucrative but you need to know when to go long or short. Timing is very important. Here I’d like to give you a simple and effective way to do that.

The purpose of this blog post is actually to clarify something. During the New Scalping Method LOBOT 2.0 session, I sounded like I was saying, “don’t do what I taught you so far, scratch that”. But that is not what my intention was.

I sounded as if I was saying “don’t look at S/R (Use AIMS Box Indicator to identify Support and Resistance Levels) or Levels to the left” etc. I want to correct that in the lessons above, especially for Lobot 2.0. So, let it be clear that I’m not saying to forget what I taught before. I’m saying, that what matters the most is what happens RIGHT there in the now and then at the hard right edge of the chart. In The NOW. That’s the most important bit.

For LOBOT (The London Open Breakout Trading Method): The first 15 minutes – What matters is the current candles, at the open… and its relation to the open price. What happened overnight or 10 days ago does not matter. The highs and lows of the Day or the day before might come in handy a bit later but not right at the open.

15 min later, we are into the S/R and pullback and wave counting world. After the first 15-20 minutes are over then we can begin to look for our S/R zones, the setup 1/2, the hunt seeds and cherry signals, and all different types of trading entries that we make. Both videos focus on How to trade trending or sideways markets.

2 candle pullback, 3 candle pullback, 3-5 candle pullback. All the same…

MOST IMPORTANT POINT for a day trader/scalper… You must know, at any given point whether the market is either
a) trending up or down
b) sideways / range.

Both modes of the market can be traded but both require different trading approaches and entry methods.

e.g. The pullback entry method is NOT going to work within the range-bound market.

If you find yourself in a range-bound market you should either chose NOT to trade or if you want to trade the range-bound price then you have to “sell resistance and buy support”

Likewise selling resistance and buying support is NOT going to work within a trending market.

How Long Does the Market Stay within a Trend or a Range?

While watching a 1 or 5 minute chart, the trend could be just those 3-10 candles and a range could be just those 10-20 candles.

e.g. on the 8th of April DAX 30 moved inside a sideways range for the first 30 minutes. Then it broke into a trend and stayed like that for 47 minutes followed by a range again.

How to Buy or Sell within a Range and a Trend?
Sell the breakouts of Ranges, and sell the pullbacks within trends. The DAX 30 was in a range within the first 30 minutes. Sell the breakout above the range highs as in the picture below.

When to Sell a Breakout of a Range and Why?
If there is a Range within a Trend… (setup 1) then you sell the break of the range.
Confused? Don’t worry it’s simple. When there is a trend, followed by (pay attention here) a TIGHT RANGE… then sell the break of the range… like so…

In the picture below I have marked the Tight Range with Cyan colour box. This is a Tight box which was preceded by a down trend. Sell the breakout below the tight box. This is the SETUP ONE.

So in summary

  1. Within Sideways Market where the range is good (high range, i.e. distance between range high and range low is wide/TALL)… sell or buy the breakouts in opposite direction. (Sell Breakout above the range highs and Buy breakout below the range lows)
  2. Within Tight Ranges that are preceded by a trend phase, sell the breakout below the range lows if the preceding wave was a downtrend, and buy the breakout above the range highs if uptrend.
  3. Within trends, that is price has broken out of range, buy/sell pullbacks in the direction of the trend.

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