NR7 identifies the single bar, out of the last 7, with the narrowest high-to-low range, a sign that volatility has contracted to an unusually tight level. The pattern is read as a coiled spring: periods of unusually low volatility tend to precede periods of unusually high volatility, so an NR7 bar is often followed by a larger-than-normal move in one direction or the other.
An NR7 breakout strategy waits for the narrow bar, then enters on a break above (or below) that specific bar's high or low, using the coil itself as the reference level, rather than a longer lookback range like ORB uses.
zengtrade's NR7 strategy only trades breaks in the direction of an existing uptrend (skipping the pattern entirely in a downtrend or sideways market), on the reasoning that a volatility contraction inside an established trend is a higher-quality setup than the same pattern with no directional context.
Educational content, not investment advice. zengtrade is paper-first and non-custodial.