British Pound / Japanese YenEducation
Understanding charts. Support and resistance
https://www.tradingview.com/chart/BegWWkNQ/
1. The importance and significance of support and resistance in Forex Trading cannot be overestimated. Being able to identify these correctly is a huge part to being able to understand where points of interest are in the market.
2. In Reality, the levels aren’t always strictly adhered to by the market, but they are defiantly indications of points of interest of traders. The exact levels can be «tested», furthermore, when there is a high level of volume in a particular market, you will see the price literally crash through the previously held levels making them than redundant in that scenario.
3. Initially it can be confusing to try to mark lines of support and resistance that are actually significant. We recommend that, depending on your preferred style trading, you see a top down method of looking at candlestick charts to identify with areas are stronger than others. This will probably mean for most people, starting on a Daily or even Weekly timeframe and working your way down to the timeframe that you are trading on, 4 Hourly or Hourly.
Trading Tip
Sometimes when you are watching an asset, despite your expert analysis of the market, it behaves in a way that is not in keeping with its established pattern. For this reason, we would alwayse advise that while you are learning to trade Forex, it is very Important to have set stop-loss and take profit levels for every trade. Some more experienced traders prefer not to use a stop-loss, especially in times of high market volatility, however, at this beginning stage, it is advisable in order to avoid being margin-called and losing all the hard-won profits you have made on one silly mistake, a.k.a ‘blowing up’ your account.
1. The importance and significance of support and resistance in Forex Trading cannot be overestimated. Being able to identify these correctly is a huge part to being able to understand where points of interest are in the market.
2. In Reality, the levels aren’t always strictly adhered to by the market, but they are defiantly indications of points of interest of traders. The exact levels can be «tested», furthermore, when there is a high level of volume in a particular market, you will see the price literally crash through the previously held levels making them than redundant in that scenario.
3. Initially it can be confusing to try to mark lines of support and resistance that are actually significant. We recommend that, depending on your preferred style trading, you see a top down method of looking at candlestick charts to identify with areas are stronger than others. This will probably mean for most people, starting on a Daily or even Weekly timeframe and working your way down to the timeframe that you are trading on, 4 Hourly or Hourly.
Trading Tip
Sometimes when you are watching an asset, despite your expert analysis of the market, it behaves in a way that is not in keeping with its established pattern. For this reason, we would alwayse advise that while you are learning to trade Forex, it is very Important to have set stop-loss and take profit levels for every trade. Some more experienced traders prefer not to use a stop-loss, especially in times of high market volatility, however, at this beginning stage, it is advisable in order to avoid being margin-called and losing all the hard-won profits you have made on one silly mistake, a.k.a ‘blowing up’ your account.
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