Forex Support and Resistance

forex-support-resistance.jpgUnderstanding support and resistance will give you an image to understanding how the market works. This will help you enter and manage your trades to a highly accurate degree with minimal stops and reasonable, reachable targets.

 

How to draw support and resistance? First you have to learn to identify these levels once you open a chart, draw lines where you can see major support and resistance, especially on the higher time frames, and everything else you learn during your Forex training will fall into place.

 

Once price break through the resistance, it now becomes a level of support. If it is a key level of resistance that is broken, once price has moved on through it can become major support. It is often possible to enter a trade at an optimal point by simply waiting for price to come back to test that strategic level that was broken.

 

By using this,rather than chasing price and hastily putting a trade in once the market has started to move in a certain direction, wait for price to pull back to that key level that was broken. Put an entry order in at the level and wait for price to pull you in to the trade.

 

 

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