Concepts of Range Identification and Range Resetting in Trading

Key Points

Range Identification: Determining where ranges exist in trading using high time frames.
Range Resetting: The process of back-testing and re-evaluating ranges.

Start with the Highest Time Frame: Begin by identifying ranges on a weekly or monthly time frame.
- Example: Weekly range at 9568 level.
Avoid Small Time Frames: Starting on small time frames can lead to missing information and wrong architecture.
Identify Greediest Levels: Find the most optimal entry points within a range.
- Example: On a one-hour range, determine the greediest part.
Adjust Levels: If a range or level is already tested, move to the next time frame or range.
Range Flow: Observe how ranges interact and create flow within price movements.
- Example: Levels inside a range may become irrelevant once a higher time frame range is tested.
Final Hold Levels: Identify final hold levels to determine if a range will sustain or break.
- Example: A range might drop significantly if not held on key levels.

Find Greediest Part of the Range: Identify the most advantageous entry point in the range.
Work from Higher to Lower Time Frames: Move from higher time frames downwards to avoid confusion and missed data.
Compare Levels: Evaluate different levels within a range to determine which is more likely to hold or break.
- Example: Decide between a 5-minute or 15-minute hold level based on previous tests.
Range Resetting in Detail: Mark levels as tested or untested and adjust ranges accordingly.
- Determine which ranges are already tested and can't be used (mark in orange).
- Identify new possible ranges to be tested.
Consider Polarity: Polarized levels (high impact levels) are crucial for strong moves or bounces.
- Example: A level might act as a key point for reversal if it's a final untested level in a strong movement.

Levels and Tests: Use visual cues like colors and lines to differentiate tested and untested levels.
- Example: Dash and orange for tested ranges; solid green for potential ranges.
Time Frames and Levels: Compare ranges across time frames to validate consistency.
- Example: A level valid on the four-hour time frame should align when observed on the one-hour or 15-minute time frame.
Move Projections: Understand how moves and trends will evolve after identifying ranges.
- Example: A break at a certain level could lead to a significant downward or upward trend depending on range analysis.

Ignoring Higher Time Frames: Can result in missing major range data points.
Over-reliance on Smaller Time Frames: Can lead to incorrect range architecture and trading decisions.
Neglecting Tested Levels: Attempting trades on already tested levels that have higher chances of failing.

Accurate range identification and resetting are essential for successful trading decisions.
Always begin analysis with higher time frames and work downwards to ensure no crucial levels are missed.
Evaluate and adjust ranges dynamically based on market behavior and previous tests to maintain effective trading strategies.