For Business

Price Action

How to Tell a Range From a Trend

A range is a stretch where the highs and lows keep coming back to the same two levels; a trend is a stretch where each high and each low lands above the last, or below it. This paper shows you the test on two stretches of gold drawn from their turning points, the idea as a room and a ramp, each stretch on the daily chart, and how to zoom out so enough highs and lows are on the screen to compare.

Difficulty
Advanced
Reading time
5 min
Pages
8
Reviewed by
Saman Rahbar

This paper is locked

Read it in the browser and keep the PDF with Premium, or buy this one paper.

Buy this paper — $3Get Premium

Two stretches of the same chart

A trend is a stretch where the price is going somewhere; a range is a stretch where it is not. The way to tell them apart is the highs and the lows. Gold from December 2024 to April 2025 went from 2582.67 to 3499.96, and along the way every low sat above the last low and every high above the last high. Gold from June to August 2025 came up to about 3450 four times and down to about 3250 five times, and ended the summer where it began. Same chart, same instrument; one is a trend and the other a range, and the turning points say which.

A room and a ramp

The picture is a room and a ramp. In a range the price is in a room: there is a ceiling it keeps coming up to and a floor it keeps coming down to, and every bounce lands on the same floor. In a trend the price is on a ramp: it still bounces, but each bounce lands higher than the last, or lower, and there is no ceiling or floor it returns to. Both have ups and downs. Where the ups and downs land is the whole difference.

This paper is locked

Read next