To start off on the right foot, you'll need to identify the trading range. This can be located after a currency has recovered from a support area—ideally at least twice—while it should also have retreated from a resistance area—once again at least twice. That being said, it is not a requirement for these highs and lows to be similar in every way, but they should at least be close together. Some traders have a tendency to hold back until more than two highs and lows have occurred; however, this is a case of personal preference. After these highs and lows have occurred and subsequently been pinpointed, a straight line can link them on a chart, thus creating the currency trading range.

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