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Psychologicallevel

Bear and bull scenario for today (MONDAY)We recovered the wick from Sunday with the move lower just before the close of the weekly candle. I could see some mean reversion here on the table and a possible break or rejection near the daily open (offset) at $58.4k. Like always $58k region is key. A possible rejection can happen at the psychological low at $58.2k. Right now we are still in the range of $58k - $61k. London Session starts in 8 min and will start the day. Let's go. Trade safe!
Short
by reports20netrust
Psychological Levels and Round Numbers in Technical Analysis When traders analyze the key levels, quite often then neglect the psychological levels in trading. In this article, we will discuss what are the psychological levels and how to identify them . What is Psychological Level? Let's start with the definition. Psychological level is a price level on a chart that has a strong significance for the market participants due to the round numbers. By the round numbers, I imply the whole numbers that are multiples of 5, 10, 100, etc. These levels act as strong supports and resistances and the points of interest of the market participants. Take a look at 2 important psychological levels on EURGBP: 0.95 and 0.82. As the market approached these levels, we saw a strong reaction of the price to them. Why Psychological Levels Work? And here is why the psychological levels work: Research in behavioral finance has shown that individuals exhibit a tendency to anchor their judgments and decisions to round numbers. Such a decision-making can be attributed to the cognitive biases. Quite often, these levels act as reference points for the market participants for setting entry, exit points and placing stop-loss orders. Bad Psychological Levels? However, one should remember that not all price levels based on round numbers are significant. When one is looking for an important psychological level, he should take into consideration the historical price action. Here are the round number based levels that I identified on AUDUSD on a weekly time frame. After all such levels are underlined, check the historical price action and make sure that the market reacted to that at least one time in the recent past. With the circles, I highlighted the recent reaction to the underlined levels. Such ones we will keep on the chart, while others should be removed. Here are the psychological levels and proved their significance with a recent historical price action. From these levels, we will look for trading opportunities. Market Reaction to Psychological Levels Please, note that psychological levels may trigger various reactions of the market participants. For instance, a price approaching a round number may trigger feelings of greed, leading to increased selling pressure as traders seek to lock in profits. Alternatively, a breakout above/below a psychological level can trigger buying/selling activity as traders anticipate further price momentum. For that reason, it is very important to monitor the price action around such levels and look for confirmations . Learn to identify psychological levels. They are very powerful and for you, they can become a source of tremendous profits. ❤️Please, support my work with like, thank you!❤️
FOREXCOM:XAUUSDEducation
by VasilyTrader
1
Power of Psychology TradingIn the dynamic world of trading, it is widely acknowledged that strategy and market knowledge are essential for success. However, there is a critical aspect that often goes unnoticed but holds immense power in shaping trading outcomes: the psychological dimension. The psychological aspect of trading encompasses understanding and effectively managing emotions, biases, and mental states that can significantly impact trading decisions. Neglecting this facet can lead to costly mistakes driven by emotional decision-making, such as panic selling during market dips or clinging onto losing trades fueled by hope or fear. Thus, it is crucial to cultivate a clear and disciplined mindset to achieve more profitable and consistent trading outcomes. This tutorial aims to delve into the psychological landscape of trading, offering invaluable insights and practical tips to help you master your mind and, consequently, conquer the market. Common Psychological Traps in Trading Traders frequently fall into various psychological traps that can severely undermine their trading performance. One such trap is overconfidence. After experiencing a string of successful trades, it becomes easy to develop an invincible mindset, leading to riskier behaviors and impulsive decisions. Fear and greed are two emotions that often dictate trading decisions. They serve as key drivers behind market trends but, if not managed properly, can result in significant financial losses. The fear of missing out (FOMO) can drive traders into hasty, poorly thought-out trades, while greed can create a reluctance to sell even when all signs point to a market downturn. Another common psychological pitfall is anchoring. This occurs when traders become fixated on specific price points or values, distorting their perception of a security's true worth and hindering rational decision-making. Understanding Your Trading Emotions To effectively manage your trading emotions, it is essential to first understand them. One practical approach is to maintain a trading journal. In addition to recording your trades and their outcomes, this journal should document your emotions and thoughts at the time of each trade. Over time, patterns may emerge, revealing how your emotions influence your trading decisions. Another crucial factor is knowing your risk tolerance. Each trader possesses a unique level of comfort when it comes to taking risks, and comprehending this can significantly shape your trading strategy. A risk-averse trader might prefer more stable assets, while a risk-tolerant trader may be comfortable with higher volatility. Strategies for Managing Trading Emotions Being in the right mental state before engaging in trading is paramount. Developing a pre-trade routine that helps you calm down and focus can prepare you for the trading day ahead. This routine could include activities such as meditation, exercise, or reviewing the latest market news and your trading plan for the day. Having a clear trading plan also provides a solid foundation for managing your emotions. This plan should outline your strategy, encompassing risk management tactics, potential entry and exit points, and your objectives for each trade. It serves as a roadmap, grounding you when market volatility triggers emotional responses. Additionally, learning stress management techniques can be invaluable in the trading arena, often laden with stress. Taking regular breaks, practicing deep breathing exercises, and maintaining a balanced lifestyle outside of trading can help maintain your mental equilibrium. Conclusion and Further Reading Trading psychology is a vast and intricate field, but understanding its fundamental principles can profoundly enhance your trading performance. By familiarizing yourself with common psychological traps, comprehending your own emotions and risk tolerance, and employing effective strategies to manage your trading emotions, you can make more informed and profitable trading decisions. Continuous learning and emotional self-awareness are key to successful trading. There are numerous resources available for those who wish to delve deeper into trading psychology, risk management, and market analysis. While the journey to master your trading psychology may present challenges, the potential rewards - improved trading outcomes and personal growth - far outweigh the effort invested.
NASDAQ:NVDA
by A1TradingHub
EURAUD I What to consider before shorting key resistanceWelcome back! Let me know your thoughts in the comments! ** EURAUD Analysis - Listen to video! We recommend that you keep this pair on your watchlist and enter when the entry criteria of your strategy is met. Please support this idea with a LIKE and COMMENT if you find it useful and Click "Follow" on our profile if you'd like these trade ideas delivered straight to your email in the future. Thanks for your continued support!
by BKTradingAcademy
3
Downgraded From BB+ To BBIt's a personal opinion of mine that psychological levels, whole number resistance and support, should have this much control over price action. Psychological levels have the most effect when there's extremes of emotions. I feel it's rather self-explanatory. It's either going towards zero or it's getting bought to prevent it from hitting the pavement. The variance in price alone is a clear indicator its in deep trouble while it was just downgraded to BB. Previous low on charts of $17.60 is notable, while $20 pertains to psychological significance. Below this, I see little more than psychological levels. $10, double digits. $5, where select exchanges consider a stock a penny stock. $1, where the rest consider it a penny stock. You can label a ton of this chart a deadcat bounce here or there. Please add thoughts. I didn't see a Fibonacci ladder helping much because the price action was too chaotic. DYOR/DYOC.
NYSE:FRCShort
by mrniemeier
2
📍 The 5 Step Process1️⃣ MARKET STRUCTURE The market structure has a significant impact on the formation of prices, dissemination of information, and execution of transactions. In the context of stock trading, market structure can also refer to the pattern of price movements in a downtrend, characterized by lower highs and lower lows. This pattern indicates that prices are consistently decreasing over time and that selling pressure is outweighing buying pressure. The market structure in a downtrend can provide important information to traders and investors about the overall sentiment in the market and can inform their decision-making process. 2️⃣ PSYCHOLOGICAL LEVEL A psychological price level in trading refers to a price point that is believed to have a significant impact on market participants' behavior and decision making. These price levels are usually round numbers, such as $50 or $100, or important milestones, such as all-time highs or lows, and are often used as reference points in trading. Market participants often view psychological price levels as significant barriers that need to be breached or defended in order to signal a change in market sentiment. 3️⃣ FIBONACCI Fibonacci retracement is a technical analysis tool used in stock trading to identify potential levels of support and resistance. It is based on the idea that prices will tend to retrace a predictable portion of a move, after which they will continue to move in the original direction. The tool is used by drawing a trendline between two extreme points and then dividing the vertical distance by the key Fibonacci ratios of 23.6%, 38.2%, 50%, 61.8% and 100%. 4️⃣ TRENDLINE A trendline in trading is a straight line drawn on a price chart to identify a current trend in the market. The trendline is drawn by connecting two or more price points and is used to identify the direction of the trend, either up, down, or sideways. If the trendline is sloping upwards, it is considered an uptrend, and if it is sloping downwards, it is considered a downtrend. 5️⃣ CANDLESTICK A twizzer bottom is formed when a long green candle is followed by a red candle that closes below the midpoint of the first candle. This pattern indicates that the buying pressure that was present in the first candle is being replaced by selling pressure, and suggests a potential reversal from an uptrend to a downtrend. It's important to note that a twizzer candlestick pattern is just one piece of information and should not be relied upon solely when making trading decisions. It is often used in conjunction with other technical analysis tools and indicators to form a more comprehensive view of market conditions. 👤 @AlgoBuddy 📅 Daily Ideas about market update, psychology & indicators ❤️ If you appreciate our work, please like, comment and follow ❤️
by QuantVue
2
Trader comfort zone journey 🥴➡️😊Let's end the week on a thoughtful note. On the chart is a visual I see the other day that I feel relates to trading massively. It's called the comfort zone map. This can be applied to many situations in a person's life as a generic visual map. But I really do think it represents the journey every trader must take in order to become successful. COMFORT ZONE It's where we all start any journey Sat in the comfort zone not wanting to leave as we dont want to fail or get hurt. Some will stay in this zone forever but will never progress. If you are on TradingView looking at this idea then chances are leaving this zone is already being explored. We all like this zone put you have to take the leap of faith in order to progress. As traders we all have to leave our comfort zone in order to start our trading journey. FEAR ZONE This is the worse zone for any human on any sort of journey but more so for traders. Things are really uncomfortable in this zone and pain will be felt. Mistakes will made, as traders money well be lost but key bit is learn from those mistakes. Plenty of people will turn their backs at this point and jump back into the comfort zone. Those who carry on trying to achieve will have other people questioning what are they doing. Don't let opinions sway you and find a way to find your feet in this zone. You will lack knowledge, You will lack skills at the start but traction comes with hard work and persistence. LEARNING ZONE The traction gained and hurdles overcome in the fear zone leads you to this zone. Once in this zone it's now all in the eye of the beholder. This is now the new comfort zone but don't drop the ball you can end up dropping back in this zone. Now's the time in this zone to really kick on but it can take time. You are now laying the foundations of an exciting future. Take the base knowledge gained and gain even more in this zone. Problems are no longer holding you back as you are able to overcome. You enjoy the challenges and tackle them head on while still learning. Putting the time in here takes you to the next step but also stands you in good stead for rest of lives hurdles. GROWTH ZONE This where the fruits of your labour are felt but not just in trading profits. Mindset and contentment are on point. Due to the above continued learning never stops. Objectives are now smashed. Purpose and fresh identic is now found within yourself. Continued Personal growth as well as financial growth is now a element of life. In this zone the end game is infinite but shouldn't be taken for granted. Hard work has got you here but don't get complacent. Treat everyday as an opportunity to fulfil your life even more in many ways not just money. You earnt the right to be in this zone so enjoy. But be grateful in this zone and take nothing for granted. Stay level headed and with the right mindset this becomes your new comfort zone to enjoy forever. Enjoy the weekend folks and see you next week 👍 Darren✌️
Editors' picks
Education
by pow_removetheguesswork
52
Strong fundamentals + 1.13500 + price AStrong fundamentals and the action of price both support the sell from the psychological level at 1.13500. Price action + technical indicator (preferably one of the oscillators) = Divergence Price made a high broke it and made a Higher high on the chart and on the RSI. Iit made a high and a lower high, price couldn't break that high on the RSI and viola, Divergence was handed to us on a platter !. EURUSD is going to sell but it needs to consolidate a bit to gather enough volume to do just that !. Parameters Sell EURUSD to the next psychological level or like 10 pips before 1.13000 which is exactly 1.13100 Set your stop 🛑 loss @15 pips above entry which gives us 1.13650. If price hits our stops, we sell again, maintaining our stop level at another 15 pips and that will be all for the day if fundamentals fail us during NYSE. WE ARE SELLING JUST TWICE. KEEP THAT IN MIND !.
Short
by LaBOSS_FX
3
EURUSD week's summary and 3:1 winnersAfter this week's bearish rally of EU the prices seem to stop to build a pre-continuation accumulation structure. Mr. Wyckoff comes into play with a clear PS (preliminary support). Glad to see it around this area, as we're clearly 'touching' a lower channel line (1H structure). What can we expect? As usual some fakey fakey(!) should come into play, not only candles, but the whole structural movements, so be careful around the lower channel area. A potential for a down-continuation for the 1,12-1,13 psycho levels (doubling with some money left out last time price was there) area in the upcoming weeks, however there's a possibility of the price coming back to 1,16 psycho-round-number-it's-a-bingo... to rob the bank once again and get the prices down. Definitely something to watch out for around those areas. With no super important news coming out till the market close for the week, I'm watching the structural development of the price, and I'll keep you posted about my ideas for the thingy :) just my thoughts, nothing more. Have a great weekend traders.
by GibsonTrades
GBPUSD - Further DeclineI have been following GBPUSD's recent decline from the 1.38000 level over the past few weeks across various intra day positions. I am anticipating price to fall further toward the September low at the 1.34000 psychological, which is also it's lowest price since December 2020. I have entered another short position today following the retest of the 1.36 level, which i am hopeful can hold as resistance. Let's see how this plays out over the next few days and if our target can be reached.
Short
by MMQ_FX
1