Range Bound Idea with Trendline Breakout

19 Sep

SBFC

Range-bound equity trading is a strategy used by traders who believe that a particular stock or index will trade within a specific price range for a certain period.

This approach takes advantage of predictable price movements within upper and lower boundaries, or "support" and "resistance" levels, without anticipating a breakout (a move outside the range).

Breakout of Resistnace will lead further upmove.

Trendline breakout can be observed with SBFC inside range indicates further upmove if sustain above trandline and Upper Range.

Key Concepts in Range-Bound Trading

Support and Resistance:

Support: The price level where demand for the stock is strong enough to prevent further decline. It acts as a floor where prices tend to bounce higher.
Resistance: The price level where selling pressure is sufficient to prevent further upward movement. It acts as a ceiling, causing prices to pull back.

Range: The price range is the area between support and resistance. Traders monitor this range, expecting that prices will oscillate between these levels for a period.

Volatility:Range-bound markets generally exhibit lower volatility, meaning that prices fluctuate within a confined range rather than showing large swings.