The Weekly Box in One Picture

A week of trading looks busy on a chart. Dozens of candles, many swings, many opinions. The Outer Box method squeezes all of it into one picture: a box with a top, a bottom, a middle and two lines near the edges. This lesson draws that picture for one finished week of EUR/USD and shows what each line means. It teaches a way to read a chart. It does not tell you what to do in any market.

What you will be able to do

• Say which two prices draw the week’s box, and where they come from.
• Calculate C, the 10% line and the 90% line from R1 and S1.
• Explain why C is the middle of the range and not the week’s closing price.
• Give a price’s position as a percentage of the box, and say which zone it is in.
• Name what would confirm a reading and what would break it.

The week is one candle

Chapter 2 says a candle reports four numbers: open, high, low and close. The high and the low are the edges of a box. A weekly candle is a box for every daily and hourly candle inside that week.

Chapter 4 shows how the box is built. The week’s high is the highest of its daily highs. The week’s low is the lowest of its daily lows. Nothing else goes in. The weekly box has no information that was not already in the days.