How to Trade Support and Resistance in the Forex Market

What is Support and Resistance?

• Support and resistance are specific levels or zones on the trading chart, where the price of a Forex pair (or equity, commodity, etc.) is likely to find opposition.

What is Support and Resistance?

• Support and resistance areas are the zones where the interests of the market players intersect. Imagine a simple “Tug of War” game, where two teams are pulling a rope over a mud puddle. The weaker ones lose and end up in the mud puddle. In our case these are the bulls and the bears fighting for dominance in the market.

difference between a support and a resistance

• Supports are the levels which are beneath the current price, while resistances are the levels above. Furthermore, when price goes down through a support level and breaks it, this level becomes a new resistance and vice versa

How to find support and resistance levels?

• A potential support turns into an actual support, when the price conforms to its level more than once. The same holds true for resistances.

set entry/exit points

• Setting entry and exit points on S/R levels - The right way to enter or exit a trade around Support and Resistance is to and wait for the price to interact with the level first, and analyze the price action around the levels.

How to trade support and resistance?

• Price action traders tend to confirm the signals they get with additional trading tools like candle patterns, chart patterns, oscillators, momentums, etc. .

How to trade support and resistance?

• One of the most common ways to trade key levels is simply by trying to go with the market flow after the price has shown its bias toward a support or a resistance level

How to trade support and resistance?

• The more the level is tested, the more reliable it is

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