Forex Support Resistance

SUMMARY

Knowing forex support and resistance is so important because they are the building blocks to price action analysis. In addition, Tflow® integrates time into support and resistance, thus able to quantify a support or resistance level to determine whether it will be a big move or otherwise.


FOREX SUPPORT & RESISTANCE IN DETAIL

Forex Support Resistance are another tools that we use to find our Entry or Profit Taking or Stop Loss. It is part of our analysis in trading of our plan.

How to use Forex Support Resistance

  • Support and resistance are price levels. However if you could quantify them with time, it would be super powerful inputs to your analysis and trading.
  • Most important, if you could understand the strength of each S/R levels, you will have commitment and strength to believe in your trade setup. You will be able to hold true to your trade plan.
  • Powerful and explosive price movement will come from these 2 factors:
    • Breakout of strong levels, lengthy consolidation
    • A firm close in this breakout

Let’s look at a stunning win we had shorting EURUSD in 2014


1000 pips Monster
Student Reply of 1000 pips

  • Eurusd broke out on a 7-year consolidation pattern when it closed below 1.21. It took only 2 weeks for price to close below the 1.21 level that held true for 7 years. Isn’t this a very bearish indication? This led Binni to think rationally (not crazily) that Eurusd can move 1000 pips down. In fact it took only 26 days!
  • Always look at price level (or support/resistance) in term of time. Ask: how long was this level valid for? Years, months or week?
  • The longer the period, the more substantial a price level is. For e.g., if price broke a 2 year level, it will have a bigger move than breaking a 2 month level.
Forex Support Resistance

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FOREX WINNING

TRADES & LOSING TRADES


"Live" actions and reviews from our students directly from our social media accounts. We don't tweet winning trades only. We tweet losing trades as well. It's just that we have more winners. Follow @terraseeds in twitter for live trades and forex ideas.



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To read other important chart patterns for forex trading