Direct Answer
An NR7 bar is identified by comparing each day's high-low range against the ranges of the six trading days before it. If the current day's range is smaller than every one of those six prior ranges, that bar qualifies as an NR7.
Key Takeaways
- An NR7 bar is a daily bar whose high-low range is the narrowest of the past seven trading days.
- Because it has to beat six prior sessions rather than three, NR7 is a rarer and stronger volatility-compression signal than the more familiar NR4.
- NR7 flags compression only, it does not by itself say which direction the eventual range expansion will favor.
- Traders typically watch the bars following an NR7 for a close beyond its high or low as confirmation that the compressed range is starting to release.
- Like other range-based patterns, NR7 works best combined with trend context and nearby support/resistance, not traded in isolation.
Narrow Range 7 (NR7) Pattern
A Narrow Range 7 (NR7) bar is a daily bar whose high-low range is the narrowest of the past seven trading days. Because no session in the prior week traded a tighter range, an NR7 marks a sharper contraction in volatility than its more common counterpart, NR4, the narrowest bar of just the past four days.
What Is an NR7 Bar?
An NR7 bar is identified by comparing each day's high-low range against the ranges of the six trading days before it. If the current day's range is smaller than every one of those six prior ranges, that bar qualifies as an NR7. The label is purely descriptive of range, not of direction, an NR7 can form on an up day or a down day, and the bar's open, close, and candle color are irrelevant to the definition.
The underlying idea is that volatility tends to move in cycles: periods of unusually tight, contracted trading ranges are often followed by periods of expansion as the market resolves the accumulated indecision. NR7 is one way of flagging when a range has compressed to an extreme point relative to its recent history, making it a candidate for that kind of release.
How an NR7 Forms
An NR7 doesn't appear in isolation, it's the product of a short run of days with progressively tighter or simply smaller ranges, capped off by one day whose range is smaller than all six before it. In practice this often shows up as a visual "squeeze" on the chart: a cluster of small-bodied, short-range candles bunching together as buying and selling pressure roughly balance out and neither side commits to pushing price decisively in one direction.
Because the seven-day lookback is longer than NR4's four-day window, an NR7 bar has to out-narrow more competition to qualify. That makes it a less frequent occurrence than NR4, and the compression it flags is, by definition, more extreme relative to the recent trading history.
NR7 Example
The chart below shows a deterministic, illustrative example: seven consecutive daily bars with progressively smaller ranges, ending in a final bar whose high-low range is visibly the narrowest of the seven, the NR7 bar. Toggle between two possible continuations: a confirmation (price expands and breaks higher out of the compressed range) and a failure/look-alike (price expands the other way, breaking lower instead), a reminder that NR7 signals compression, not direction.
How to Trade an NR7
Treat it as a compression flag, not a directional call
NR7 only says that range has compressed to its tightest point in seven sessions, it says nothing about which way the eventual expansion will go. Traders generally layer in trend direction, nearby support and resistance, or volume before forming a directional bias around an NR7 bar.
Wait for a confirmed break of the NR7's own range
Because the NR7 bar's high and low mark the boundaries of the compression, a common approach is to wait for a subsequent close beyond one of those boundaries before treating the expansion as underway, rather than anticipating the breakout before it happens.
Respect the possibility of continued compression
Range contraction can persist for more than one session, a bar following an NR7 can itself be even narrower, or the market can simply stay quiet for a stretch. NR7 flags an extreme relative to the recent past, not a guaranteed turning point for the very next bar.
Common NR7 Mistakes
- Assuming a breakout direction from the NR7 bar alone, the pattern flags compression, not direction; treating it as inherently bullish or bearish is a misread of what it measures.
- Entering before the range actually expands, acting on the NR7 bar itself, rather than waiting for a confirmed close beyond its high or low, risks entering while the market is still compressed.
- Confusing NR7 with NR4, the two use different lookback windows and are not interchangeable; an NR4 bar is not automatically an NR7 bar.
- Ignoring the broader trend and nearby levels, an NR7 that forms into strong resistance behaves differently than one forming in the middle of open range; context still matters.
NR7 vs. Similar Patterns
| Term | What it emphasizes | Key difference from NR7 |
|---|---|---|
| NR7 | Narrowest high-low range of the past seven trading days | Baseline, the longer seven-day lookback makes it a rarer, stronger compression signal |
| NR4 | Narrowest high-low range of the past four trading days | Shorter lookback window, so it triggers more often and flags a comparatively milder compression |
| Inside bar | A single bar whose entire range sits inside the prior bar's range | Defined by containment within one prior bar, not by being the narrowest of several; an inside bar can still be a wide range relative to the week |
Limitations of NR7 Analysis
NR7 is a purely range-based measurement, it says nothing about volume, the broader trend, or nearby support and resistance, all of which shape how the eventual expansion is likely to play out. It also carries no guarantee: a compressed range can stay compressed for additional sessions, and when expansion does arrive, it can break in either direction. Like other single-bar range patterns, NR7 is most useful as one input alongside trend and level context, not as a standalone trading signal.
Rarer by Arithmetic, Not by Insight
NR7 is less common than NR4 for a purely mechanical reason: it has to be the narrowest of seven sessions rather than four, so fewer bars qualify. That scarcity is often read as strength, and it is worth being precise about what it does and does not mean. A rarer signal is a more selective one, describing a tighter contraction relative to a longer window, and nothing about the higher bar makes it any more directional than NR4.
Both patterns answer the same question at different sensitivities, and mixing them in one process means comparing signals filtered at different strictness. Choose one for a stated reason and stay with it, since counting NR4 and NR7 occurrences together produces a signal series with two definitions in it.
The entry discipline is the part people compress. Acting on the NR7 bar itself means positioning while the range is still contracted; the setup resolves when price closes beyond the bar high or low, and that is the observable event.
Range is all the pattern measures. It carries no volume, no trend and no level context, all of which shape how an eventual expansion is likely to behave, and the compression can persist for further sessions before anything happens.
NR7 FAQs
What is a Narrow Range 7 (NR7) bar?
A Narrow Range 7 (NR7) bar is a daily bar whose high-low range is the narrowest of the past seven trading days. It signals that volatility has compressed sharply relative to the recent past, since no session in the last week traded a tighter range.
How is NR7 different from NR4?
NR4 identifies a bar with the narrowest range of the past four days, while NR7 requires the narrowest range of the past seven days. Because NR7 has to beat six prior sessions instead of three. It is a rarer and stronger volatility-compression signal than NR4.
What typically happens after an NR7 bar forms?
A period of unusually tight range tends to be followed by a period of range expansion, since volatility historically moves in cycles of contraction and release. Traders watch the sessions following an NR7 bar for a breakout beyond its high or low, though the pattern itself does not say which direction that expansion will take.
Does NR7 predict which direction price will break?
No. NR7 only flags that volatility has compressed to its tightest point in seven sessions, not which direction the eventual expansion will favor. Traders typically combine it with trend context, nearby support and resistance, or volume to judge the more likely breakout direction.
Can NR7 be used on timeframes other than daily bars?
The classic NR7 definition refers to daily bars, comparing each day's range to the prior six trading days. The same narrowest-of-seven-periods logic can be applied to other bar intervals, but the historical research and terminology behind NR7 specifically describe the daily chart.
Is every NR7 also an NR4?
Yes, necessarily. If a bar has the narrowest range of the last seven, it also has the narrowest of the last four, because those four are a subset of the seven. The reverse does not hold. NR7 is therefore the strictly stronger condition, and any list of NR7 bars is a subset of the NR4 list on the same data.
Why seven rather than some other number?
The specific value comes from Toby Crabel work on short-term price patterns, which popularised both the four-bar and seven-bar versions. Nothing derives seven as optimal. It is long enough to require genuine contraction and short enough to occur with some regularity, which is the practical balance any such window has to strike, and other lengths are equally defensible.
How often should an NR7 be expected to occur?
There is no fixed rate, because it depends entirely on how bar ranges are distributed in that instrument and over that period. In a market where ranges vary widely, the narrowest of seven stands out and appears less often; in one where ranges are similar, the condition is satisfied more readily by a bar that is barely narrower than its neighbours. Any expected frequency has to be measured per instrument.
Should NR7 use the true range instead of the high-to-low range?
The standard definition uses high minus low, which ignores gaps entirely. A bar that gapped and then traded in a narrow band qualifies as NR7 despite the session having covered substantial distance from the previous close. Substituting true range would capture that and would produce a different and smaller set of qualifying bars, so the two versions are not interchangeable.