Trading ranges

Trading ranges can be identified by the RSI readings becoming range bound between 40 and 60. However, it’s a good idea to consider the trading range to have a bias based on the most recent high or low RSI reading. For example, if the RSI peaked above 60, indicating an upward trend, and is now crisscrossing between 40 and 60, the range should be considered to have a bullish bias. If the recent extreme RSI reading was below 40 and was now locked in a range between 40 and 60, consider the congestion phase to have a bearish bias.