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<p>Range-bar charts are different from time-based charts because each new bar in a range bar is based on price movement rather than units of time, like minutes, hours, days, or weeks.</p>
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<p id="isPasted">Range bars are used to find scalping opportunities. Range bars are charts that are only drawn when the market price moves by several points defined by the trader. Time is not relevant. Only price movement is relevant and shown.</p><p>Positions are only taken when a range break-out occurs. The Nano Trader automatically detects and draws trading ranges and breakouts.</p><p>When the trend is positive (green background) and establishes itself above the trading range, a position is bought at the market price. When the trend is negative (red background) and the market price establishes itself below the trading range, a position is sold short.</p>
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<p>One method for establishing suitable settings is to consider the trading instrument's average daily range. This can be accomplished through observation or by utilizing indicators such as average true range (ATR) on a daily chart interval. Once the average daily range has been determined, a percentage of that range could be used to establish the desired price range for a range bar chart.</p>
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<p>Short-term traders may be more interested in looking at smaller price movements and, therefore, may be inclined to have a smaller range-bar setting. Longer-term traders and investors may require range bar settings that are based on larger price moves.</p>
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<p>The ideal settings for range-bar charts depend on the security, price, and amount of volatility.</p>
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