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NR7 Trading Strategy – The Narrow Range 7 by Toby Crabel (+Video)

Last Updated on 10 February, 2024 by Rejaul Karim

Trading in the stock market can be challenging, and successful traders often rely on various strategies to make informed decisions. One such strategy is the NR7 Trading Strategy, also known as the Narrow Range 7, developed by Tobu Crabel. This strategy is based on the idea that a narrow range of price movement in the previous seven days can signal a potential price breakout in the coming days. In this article, we will discuss the NR7 Trading Strategy in detail, including its concept, benefits, and implementation.

What is the NR7 Trading Strategy?

The NR7 Trading Strategy is a popular technical analysis approach that helps traders to identify potential price breakouts in the stock market. The strategy is based on a simple principle – that a narrow range of price movement in the previous seven days can indicate a potential price breakout in the coming days. The “NR7” stands for “Narrow Range 7,” which means that the current day’s price range should be the narrowest of the previous seven days.

The NR7 Trading Strategy is not limited to any specific market or asset class, and it can be used for stocks, futures, forex, and other financial instruments.

VIDEO about the NR7 and the Narrow Range 7

 

Benefits of the NR7 Trading Strategy

  1. Helps in identifying potential price breakouts: The NR7 Trading Strategy is a valuable tool for identifying potential price breakouts. By focusing on the narrow range of price movement, traders can anticipate a potential price breakout, which can help them make profitable trades.
  2. Simple to understand and implement: The NR7 Trading Strategy is relatively easy to understand and implement. Traders can use this strategy with other technical indicators or alone, depending on their preference.
  3. Risk management: The strategy includes setting stop-loss orders to manage risk. Traders can set a stop-loss order below the low of the narrow range day to minimize losses if the price moves against their expectations.

Implementation of the NR7 Trading Strategy

To implement the NR7 Trading Strategy, traders need to follow these steps:

  • Step 1: Look for a narrow range day – Identify the narrowest range day of the previous seven days.
  • Step 2: Wait for a breakout – Wait for the price to break out of the narrow range. A breakout can be a move above or below the narrow range day’s high or low.
  • Step 3: Set entry and stop-loss orders – Once a breakout occurs, set an entry order to buy or sell. Additionally, set a stop-loss order below the low of the narrow range day to manage risk.
  • Step 4: Take profits – Traders can take profits by setting a target price or using other technical indicators to identify exit signals.

FAQs:

Q. Can the NR7 Trading Strategy be used in different markets? Yes, the NR7 Trading Strategy is not limited to any specific market or asset class, and it can be used for stocks, futures, forex, and other financial instruments.

Q. Is the NR7 Trading Strategy suitable for all traders? The NR7 Trading Strategy can be used by traders of all levels, but it is advisable to practice with a demo account before using it with real money.

Q. How can traders identify the narrow range day? Traders can use various tools such as candlestick charts, bar charts, and line charts to identify the narrow range day.

Conclusion:

The NR7 Trading Strategy is a popular technical analysis approach that helps traders to identify potential price breakouts in the stock market. The strategy is based on the idea that a narrow range of price movement in the previous seven days can signal a potential price breakout in the coming days. By identifying the narrowest range day and waiting for a breakout, traders can set entry and stop-loss orders to manage risk and take profits.

The NR7 Trading Strategy is a simple and effective tool for traders who want to make informed decisions in the stock market. By understanding and implementing this strategy, traders can improve their chances of success and minimize their risk.

In conclusion, the NR7 Trading Strategy, also known as the Narrow Range 7 by Tobu Crabel, is a valuable tool for traders who want to identify potential price breakouts in the stock market. This strategy is simple to understand and implement, making it suitable for traders of all levels. By following the steps outlined in this article, traders can use the NR7 Trading Strategy to improve their trading performance and achieve their financial goals.

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