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Thread: importence of Support and resistance level in forex

  1. #1
    Trader erox's Avatar
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    Unhappy importence of Support and resistance level in forex

    in forex support and resistence level are very importent and in most of time markit respect them we can adjust our take profit and stop loss around these levels effectively .

    a) SUPPORTS:
    in down trend where markits stop falling and try to bounce back until breakout of that level if it breaks and then it continue for another level .

    b) RESISTENCE:
    resistence lavel in up trend where markit stop going up and try to bounce back until breakout of that level if it breaks then it continue for next level .

    i think these levels are very importent for modifiying stop loss and take profit becuase the markit most of time touch thses levels and we can set our take profit and stop loss around these levels it can help us we can easily Identify these levels by using trend lines or with suuport and resistence indicator i am using it .

    (EXAMPLE)

    here is a great example of support and resistence levels ...Attachment 15192

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  2. #901
    Trader ola4real's Avatar
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    Quote Originally Posted by letsdo View Post
    the support and resistance levels is always be a crucial for price to continues the trend or make reversal and as trader we must to now how to find these levels and i think the best choice for trader to make a trade it is in this areas because levels support and resistance is the favorite of trader to make an order. and we can set SL in upper or lower of that levels.
    Yes, the support and resistance strategies are always crucial for trading. If forex traders are not using it for trading too, the trader could still use it for the placement of their stop loss and take profits, they are so effective for that function. This makes the work of the support and resistance to be important for trading, we can do well if we includes its function to any of our trading activities.

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  3. #902
    Trader Toyen's Avatar
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    Quote Originally Posted by ola4real View Post
    Yes, the support and resistance strategies are always crucial for trading. If forex traders are not using it for trading too, the trader could still use it for the placement of their stop loss and take profits, they are so effective for that function. This makes the work of the support and resistance to be important for trading, we can do well if we includes its function to any of our trading activities.
    It is good to note that the work of the support and resistance strategies can not be underpinned by forex traders. And as a matter of fact, the support and resistance strategies are the best in the market, the traders that are trading with them are trading with them with the surety that is better than other strategies. This is what i use for trading because there are many of them, i use trendline strategy to be specific.

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  4. #903
    Trader Silhouette's Avatar
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    Quote Originally Posted by ola4real View Post
    Yes, the support and resistance strategies are always crucial for trading. If forex traders are not using it for trading too, the trader could still use it for the placement of their stop loss and take profits, they are so effective for that function. This makes the work of the support and resistance to be important for trading, we can do well if we includes its function to any of our trading activities.
    Support resistance levels are always useful for many advantages both for technical and fundamental traders. Helping us to place stop loss and take profit properly is one of many good examples we can get from support resistance levels. Other traders can use the strategy to help them measure market's weak and strong levels to help them indicate possible reversal and breakout.

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  5. #904
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    The importance use of the support and resistance will tell on our trading account, the moment we are good with trading the market. Using the higher time frames then we can really get to have simple trading approach and then become even more successful. Support and resistance indicate the right spot in the chart where to buy and sell, so it adds more positive to your strategy.

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  6. #905
    Trader sniper007's Avatar
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    Support and resistance is important in the business, when you have the support and resistance knowledge, it mean you can make good analysis, you can make good trades, but then again, we need to know that it is just one of the things needed for us to become profitable, so we need to also have different knowledge of candlestick patterns which we can make use of tp

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  7. #906
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    These levels are very important because it always that level where many trader look up to open and close their positions in forex. These support and resistance will always be the best system for me in forex and once you understand this system and have your risk management in place, you will be able to earn something better for yourself in no time. I always make strong choices at this level and when the market hits any of this support or resistance, I can always look to trade reversal.

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  8. #907
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    The importance is that it helps traders to know what they should get done in the market, the analysis they should make. For instance, being that I am a price action trader, I have got to have known that when price is on the resistance then there is a possibility of seeing a sell trade, so I do wait for candlesticks to come and confirm if it is a good time to sell. that also applies for support levels.

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  9. #908
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    In my point of view if a trader only focus on support and resistance levels with proper money management than I can say with hundred percent surety that he can not face any type of beak claws and he will able to make consistent profit from the market.
    But, it's really a big problem of a trader that he cannot control his emotions and always doing trade without following these two levels.

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  10. #909
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    support and resistance will let the trader to know how and when he can set the good positions and will be able to make more and more money easily and continuously because he will put the orders in the good positions always and so the trader will make an easy money and he will not expose the account to the big risk because his mistakes will be little.

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  11. #910
    Trader J_C_Anderson's Avatar
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    The concept of support and resistance levels is one of the most important in trading. It works the same way for all timeframes and instruments, so it is necessary for any trader to be able to use it to increase profit. Some of the traders use support and resistance levels to get an additional confirmation for their setups. At the same time, there are some strategies based entirely on support and resistance levels. Such strategies could be divided at two large groups:
    - momentum strategies based on breaching the important level. The idea is that if the price could breach important level and hold long enough on the oppositie side, there is a strong momentum so the price is more likely to move in the direction of breakout. By the way, these strategies are often called "momentum trades".
    - holding strong levels. If the price fails to breach the important level, it could be an opportunity to open a position near this level placing the stop at the other side. For example, if the price fails to breach support level the trader could open long position (buy) and place stop below the support level.

    All these strategies are based on technical analysis. Despite all concerns, technical analysis is a quite powerful approach that could be highly efficient if applied properly. Another advantage of TA-based strategies is that they could be easily backtested on historical data to check their performance in long term perspective. There are special tools like Forex Tester that allow traders to execute simulated trades using historical data provided by brokers to test strategies and ideas. As the result, trader would get detailed information on the performance of the strategy including risk-reward ratio, win rate, maximum drawdown and the average number of losing trades in a row. All these criteria are important for the trader to be able to make changes and improve the effiicency of the strategy.

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