This brief tutorial shows how professional traders of stock, futures and Forex charts use support and resistance levels differently than amateurs. Retail traders often learn just enough to get themselves and their trading accounts into trouble. Or conversely, the price bars on the chart whether Forex, stocks, E-minis, etc. Support and resistance levels are not lines. We see them as lines on our charts but support are actually zones. Here we have a previous high, and then here we are coming up to another high. A lot of forex would say that this high did not provide resistance for this high over here because it made a lower high. So we have a high here and a lower high here. However that is not really the most accurate way to look at it. One of those principles, when it comes to support resistance is that the markets are a bit messy. They are not completely accurate. And little bit lower high here. So for a mark way at that high, a lot of people would expect the market to come back up and reach that high. The highest high that was previously made as resistance. The problem with that is markets are not that neat and tidy, again to translate that into market logic terms, human beings as they behave en masse. Remember we got, this is the Euro, US dollar. Number 2, you got people all over the globe trading this thing. So you got masses, hundreds, thousands, millions of people all trading this. So we have to forex for that messiness of support behavior. Fear and greed being the primary two emotions in the market. So instead of using the highs, what I like to do is use the candle stick real bodies. And this is one approach. And rejected these values, to use market profile terms, and this is really where the significant resistance was, where the real bodies are. And since the market does come up and hits the line that we draw of off the real bodies. Now let me show you another way. So we could go back to this, connect this bar and then 1, 2, 3, 4, 5 bars. Again this is just a very logical approach to say that this zone or this area within here is where the market found a lot of resistance to go up any further. And instead of looking for the extremes, look for where the majority of the voting was. You can look at it that way. Majority of the voting was, as far as people starting support feel that this is getting overbought. And connecting the most bars together there and using that as your line for your resistance. When masses of people are trading, they are going to get a support scared, get out a little earlier than the recent time or maybe get out a little bit later. It is forex really to be considered a higher high. Also I am giving forex one of my favorite trade strategies. Just fill out the yellow form at the top of the side bar on the right. Amateur traders often learn just enough to get themselves into trouble. Remember to treat your study of Forex charts seriously. The basic premise that we talked about in part 1 is that support and resistance levels are actually zones and not lines. When it comes to resistance for example, here is a resistance level at a previous swing high. Now in the last video, in part 1 support talked about what happens when you put in a lower high. But it still reaches the resistance zone. Now this time we are going to talk about the exact opposite. How to determine whether market is broken through resistance if you put in a higher high. So here we go. We got our line already brought there so now, here the next bar, we come back up to that resistance level. This was the high and now we put in a higher high. Technically that is a higher high. But have we broke the resistance yet? The answer is no. Because of a couple of things. The market closed, and that bar closed back down below that previous high. So it tested price is above there. But at least at the moment, this previous support high is not literally broken but the market is testing it. And so the market tends to pause. People are waiting to see what will happen. Now the next bar, it does put in not only higher high but also closes above the previous swing high. So again here is our previous swing high and now the bar closes above the high. The basic concept here is that we want to see above this resistance level, a real commitment of traders in the market place. We need to give it that allowance. Now it has decided. But anyway for the forex being market is seeing that, yeah we believe that forex market forex worth more than the value over here. But our signal that we would consider it really decisive would be this bar right here. The last one we saw where the market did break through the resistance level. So you can see the opposite. Now when we come back and we test that resistance level again, what happens? We technically put in a higher high. But would we consider at this resistance level or zone is broken? The answer is no because the market has not really made a big commitment to it forex. Yes its put in a higher high, yes its closed above the high but it opened below that and this candle is splitting that horizontal line. And so therefore there is not a strong commitment up there yet. And then as you can see the very next bar comes down and that resistance is not broken. It is tested, a little bit of you know, again just chaos where market go a little bit above, little bit below the line, we allow for that and now we have a rule for it. And came on down and resistance held. If you would be so kind to send me your timing indicator I would be very appreciative!! Thanks for the nice comment Mike, and I just sent you an email with the info on the free Timing Indicator. The company has not substantiated any of the comments or claims. 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The information in this site is for educational purposes only and in no way a solicitation of any order to buy or sell. The author and publisher assume no responsibility for forex trading results. There is an extremely high risk in trading. This information is provided "AS IS," without any implied or express warranty as to its performance or to the results that forex be obtained by using the information. Factual support in this site are made as of the date the information was created and are subject to change without notice. HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THE RESULTS MAY HAVE UNDER- OR OVER-COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. How to Trade Forex Charts Like a Pro. The Premise The basic premise that we talked about in part 1 is that support and resistance levels are actually zones and not lines. Because its inside bar to the previous bar. ANOTHER EXAMPLE The last one we saw where the market did break through the resistance level. Thanks for the nice comment Mike, and I just sent you an email with the info on the free Timing Indicator Leave a Reply Cancel reply MY FREE GIFT TO YOU FREE TRADE SETUP!
Forex Support & Resistance: How To Identify True Forex Support & Resistance Lines!
Forex Support & Resistance: How To Identify True Forex Support & Resistance Lines!
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Drawing (1953, San Francisco Museum of Modern Art), since both remained.
Roman poet remembered for his elegiac verses on love (43 BCE - CE 17) wrote Metamorphosis (8 CE) single most important source of classical myth.