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Help with Linksys Cisco Router

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I'm going to go ahead and start out by saying I suck at Networking so be understanding if my descriptions sound ridiculous. I bought a Linksys Cisco router about 5 months ago and hooked it up to my cable modem and everything worked fine. I wasn't having any trouble with it or anything until the other day. I was playing xbox live and my games started getting laggy and I couldn't get a full signal from my wireless network so I just turned everything off. Today I tried it again and it was doing the same thing except I only had one bar of signal. I tried to use my laptop to get on the internet to look up some reasons why it would be doing this but I couldn't connect to my wireless network. Every time I would connect it would say connection timeout. When I used network diagnostics it would say that either the password was incorrect or that the username was wrong but thats not the case. Is there someway that when I unplugged the modem and router to reset everything that I did something to mess with the wireless configuration? I also noticed that when I was on xbox live waiting in the lobby for Modern Warfare that it said that my NAT type was on moderate and it used to be on open. My wireless router is upstairs in the room right above where my xbox is which is maybe 12 feet away so there should be no reason why the xbox can't keep a full signal.

Any help would be appreciated. right now Im only able to use my PC to connect to the internet through Ethernet connection so I know it has to be something with the wireless setting in the router, I just don't have any clue of where to even start looking to fix it. Thanks in advance.
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Trying to get signal a floor down is much harder then if it is going up, if that makes any sense. Has anyone messed around with the settings?

First try to power cycle both devices. Turn the modem on first, wait for all the lights to come on then plug in the router. Also, make sure you have nothing that uses a 2.4Ghz frequency such as a cordless phone base near the router as that will interfere with the signal.
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Trying to get signal a floor down is much harder then if it is going up

that's actually slightly incorrect. Since 802.11 works off of a radio signal, the signal actually comes out of the antenna like an umbrella, it goes up for a bit but not far, it mostly goes laterally and then falls down towards the ends of the signal.

now, sitting directly under the wireless router, that can cause issues because of the umbrella effect, there's a dead spot directly under the antenna (same reason why your radio reception in your car can get worse if you get too close to the transmitting antenna for that station)

try resetting the router back to defaults and see if it makes a difference. also, have you upgraded the firmware on the router since you've gotten it?
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