Navigating flat markets can often feel like sailing a ship with no wind. Yet, one strategy for flat trading, the Rubber Band, aims to change this perception by offering traders a disciplined approach to such conditions. Dive in to discover how to optimize your trading when the markets lack a clear trend.
The dearth of specialised strategies for flat markets translates to untapped potential for both novice and experienced traders. By focusing only on trending markets, traders are essentially leaving money on the table and underutilising 70% of available trading scenarios.
The Basics of the Rubber Band Trading Strategy
The Rubber Band trade strategy is a trading approach designed specifically for those periods when the market is moving sideways, lacking a clear upward or downward trend. The strategy relies on a trio of commonly used technical indicators: Moving Averages (MA), Bollinger Bands (BB), and the Relative Strength Index (RSI). Here's how it works:
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