Stop Fading Checklist
The fade that ends a range trader's month is the one after the range was already over. This checklist scores how close the range is to breaking. Enter the range, the ATR, how many times each edge has been tested and how long the range has been going, then tick what the chart shows: closes stacking at an edge, a squeeze, a failed fade, a bigger level in the way. The score is a breakout risk score. Low, keep fading. Middle, one more fade at half size with the stop tight. High, stop fading and write the breakout plan instead. The 3-push rule and the "most breakouts fail, until the range is old" read come from Al Brooks, Trading Price Action Trading Ranges (2012). The rest are the tells every range trader learns the expensive way.
A test is a push that touched the edge and turned. Width % under 100 means the swings inside the range are shrinking (a triangle inside the box).
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Enter the range, the ATR, the price and the test counts. The numeric checks fill themselves in. Tick the chart checks by hand, or press 1 to 5.
How it scores. 100 points of breakout risk across 10 tells. Numeric: 3 or more tests of the edge price is at (20; 2 tests scores 8), range older than 40 bars (10; over 25 scores 5), range width under 40% of the ATR's 10-bar travel, meaning the box is narrow for its volatility (10), swings inside the range shrinking to under 70% of 10 bars ago (10), and price parked in the outer 10% of the range (5). Chart: 3 or more closes in the outer 20% of the range in the last 5 bars (15), a Bollinger or Keltner squeeze on (10), the last fade at this edge failed to reach the midpoint (10), a higher-timeframe level sits within 0.5 ATR past the edge and price is pressing toward it (5), and the session's big volume window opens within 30 minutes (5). Under 35: keep fading, full size. 35 to 59: last fade, half size, stop at 15% of the range past the edge, take the midpoint and stop. 60 or more: stop fading; the plan flips to the break, entry on a close past the edge, stop back at the range midpoint, target 1 range width past the edge (the measured move). Keyboard: 1 to 5 toggle the chart tells, Esc clears them.
Educational tool only, not financial advice. Ranges end without warning too. This scores the warnings that do show up, and a low score is never a promise that the next fade works.
Built by Jason Parker, founder of Trading Ranges.
Built by Jason Parker, founder of Trading Ranges.