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Range trading is on of the most simple and widely followed trading strategies for trading different instruments including forex currencies. Ranging trading does not demand too much fundamental or technical analysis, it does not demand following/predicting trends and does not require to quickly responding to news.

Forex range trading strategy is simple. Range traders believe that the market often trades with in levels/channels; or simply, with in support and resistance levels. These support and resistance levels can easily be defined. Range traders buy currencies when the price is on support level and sell currencies when the price is on resistance level. Or range traders short positions whenever the price moves up and long positions whenever the price moves down from a level.

Forex range trading strategy requires good planning. The trader should identify good range trading currency pairs (e.g.: EUR/AUD, EUR/GBP, CHF/JPY, and EUR/CHF) and he should be good with his money management. Range trading of mini forex contracts is a good choice at it offers better flexibility for going long and short. Position sizing is also very important. Remember: range trading is not a foolproof strategy, often currency pairs can cross support/resistance levels and this can cause problems for range traders. It is advised to use different indicators and tools to analyze price movements.

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