4 Hour Range Chart Explained

I've been adding a number of charts and analyses under the analysis of currency pair links on the right hand side of the page. For some currency pairs I have included only a 4 hour range chart, with no commentary; so here is an explanation of how to interprete them.

For illustration purposes here is the chart for EURGBP:



I use the chart to determine whether to trade, and in what direction. The green and red lines show the trading range for the currency pair. That is, a technical region where the price is failing to make new highs or lows. If price penetrates the green resistance level, I look for opportunities to go long. If price moves below the red line I look to go short. The blue horizontal line represents the target price, and is constructed by a simple projection of the height of the trading range (the blue diagonal lines where used to measure and project the heights).

Here is another example:



CHFJPY has broken above the green resistance line and I am looking for opportunities to go long: either a breakout or pullback on a 15M chart.