Resistance turned new support and support turned new resistance system
Page 1 of 11 12345 ... LastLast
Results 1 to 10 of 106

Thread: Resistance turned new support and support turned new resistance system

  1. #1
    Trader
    Join Date
    Sep 2017
    Posts
    1,769
    Thumbs Up
    Received: 7
    Given: 19

    Resistance turned new support and support turned new resistance system

    There are times when price would break a support level to move down and later the price could move up again to that support only to see price push back once it reaches that level. When this happens, we would say that the old support is now acting as a resistance.

    Alternatively there are times price would break a resistance level to go up but afterwards the price would start falling and when it reaches that resistance level, it pushes the price back upward. In this case we would say that the old resistance is now the new support.

    Currency to be traded : Any
    Indicators : none
    Time frame : any

    Entry buy rules : if resistance is broken, wait for a fall in price back to that level and then if it pushes it back and do not break, enter a buy trade
    Stop loss would be 10-20 pips below the old resistance now turned support. Take profit should be previous swing high

    For sell entry : if support is broken, wait for a rise in price to reach back that support level and then if prices pushes and closed back, enter a sell trade.
    Stop loss would be 10 -20 pips above that support now turned to new resistance.. Take profit should be previous swing lows

    Not allowed!

  2. #2
    Trader Sixteen's Avatar
    Join Date
    Sep 2015
    Posts
    12,155
    Thumbs Up
    Received: 141
    Given: 68
    This is a familiar method of trading and from experience its is very effective in helping out with future analysis in mapping out the right support and resistance level. When a support or resistance level breaks, we take note of those levels because in the future there is huge possibility that it will turn out to become a new resistance and as new support level. This will help us to have an easy analysis and help us properly on making the best entry trade with forex.

    Not allowed!

  3. #3
    Trader
    Join Date
    Feb 2018
    Posts
    2,301
    Thumbs Up
    Received: 11
    Given: 5
    Quote Originally Posted by Sixteen View Post
    This is a familiar method of trading and from experience its is very effective in helping out with future analysis in mapping out the right support and resistance level. When a support or resistance level breaks, we take note of those levels because in the future there is huge possibility that it will turn out to become a new resistance and as new support level. This will help us to have an easy analysis and help us properly on making the best entry trade with forex.
    yes this is good but in your point when market break any support and resistant then it means it will go for next support and resistant must and it can be after huge pips so use some sl for avoiding big loss. you can cover loss by placing new order in opposite side and hope it will work. breakout level can give us loss mostly if we are using weak support and resistant levels

    Not allowed!

  4. #4
    Trader
    Join Date
    Sep 2017
    Posts
    1,769
    Thumbs Up
    Received: 7
    Given: 19
    Quote Originally Posted by altafch View Post
    yes this is good but in your point when market break any support and resistant then it means it will go for next support and resistant must and it can be after huge pips so use some sl for avoiding big loss. you can cover loss by placing new order in opposite side and hope it will work. breakout level can give us loss mostly if we are using weak support and resistant levels
    Most breakout requires caution because if you follow the wrong breakout, there could be huge possibilities of making huge loss if care is not taken. These support and resistance level is a good one to guide us on the very ability to manage risk and sure see we get on to win good from forex. Once a breakout occurs the past support and resistance levels turns out to become a new resistance and new support level that will help us make high quality analysis for a good trade.

    Not allowed!

  5. #5
    Trader famousfx's Avatar
    Join Date
    May 2017
    Posts
    4,235
    Thumbs Up
    Received: 7
    Given: 0
    Trading using the support and resistance level is very profitable to traders, some traders refer to it as naked trading or price action, trader should be able to identify those levels so as to be able to take the trading decision based on those levels, some trader do use the indicators so as to locate them easily, trend line is also useful in trading the price action strategy,as the price is moving in an uptrend , it would be coming against resistance and when a resistance level is broken it may in turn be a support as the price is trying to reverse, so also the support in a downtrend could later be a resistance as price is trying to reverse again.

    Not allowed!

  6. #6
    Trader
    Join Date
    Jul 2017
    Posts
    8,577
    Thumbs Up
    Received: 32
    Given: 22
    This is one of the few mystery of the forex market. There is no permanent support or a permanent resistance in the forex market . Every new resistance will eventually become a support level , while every support levels will eventually become a new resistance levels. If we understand the dynamism of the forex market, then trading the resistance and the support levels will not be a difficult thing for us at all.Once a support is broken downward, then it has automatically become a resistance level and vice versa.

    Not allowed!

  7. #7
    Trader Sixteen's Avatar
    Join Date
    Sep 2015
    Posts
    12,155
    Thumbs Up
    Received: 141
    Given: 68
    Quote Originally Posted by glory3 View Post
    This is one of the few mystery of the forex market. There is no permanent support or a permanent resistance in the forex market . Every new resistance will eventually become a support level , while every support levels will eventually become a new resistance levels. If we understand the dynamism of the forex market, then trading the resistance and the support levels will not be a difficult thing for us at all.Once a support is broken downward, then it has automatically become a resistance level and vice versa.
    You are right, some traders don't just want to accept the fact that a present support or resistance must be broken at some point and become ineffective of reversal only to act as a future new resistance or support levels. Some newbies don't even know that an old support level would be a new resistance level and an old resistance level will be a new support level. I guess with this knowledge it will broaden their way on how to follow this business and see they can come up with the right analysis for good trading.

    Not allowed!

  8. #8
    Trader
    Join Date
    Feb 2018
    Posts
    2,301
    Thumbs Up
    Received: 11
    Given: 5
    Quote Originally Posted by Sixteen View Post
    You are right, some traders don't just want to accept the fact that a present support or resistance must be broken at some point and become ineffective of reversal only to act as a future new resistance or support levels. Some newbies don't even know that an old support level would be a new resistance level and an old resistance level will be a new support level. I guess with this knowledge it will broaden their way on how to follow this business and see they can come up with the right analysis for good trading.
    i think person who is doing support and resistant he must should know thing that old support can be new resistant but issue is in breakout and reversal how we can identify market will make breakout or reversal so for this thing we should use strong support or resistant. weak support and resistant mostly breakout so on weak we can take risk of breakout and on strong we can take risk of reversal

    Not allowed!

  9. #9
    Trader
    Join Date
    Mar 2017
    Location
    Biafra
    Posts
    11,775
    Thumbs Up
    Received: 58
    Given: 20
    Quote Originally Posted by altafch View Post
    i think person who is doing support and resistant he must should know thing that old support can be new resistant but issue is in breakout and reversal how we can identify market will make breakout or reversal so for this thing we should use strong support or resistant. weak support and resistant mostly breakout so on weak we can take risk of breakout and on strong we can take risk of reversal
    If making trading analysis I try to avoid weak support and resistance levels because they do not qualify to be called a quality support or resistance level that could be followed. I try to eliminate this weak support and resistance level by avoiding small time frames, but instead look at support and resistance level which are in the higher time frame because they are more stronger and quality to follow. Breakout remains a problem for traders who wait for the very support and resistance level to trade reversal and sure they need to understand how to follow the market with less risk.

    Not allowed!

  10. #10
    Trader
    Join Date
    Sep 2017
    Posts
    1,769
    Thumbs Up
    Received: 7
    Given: 19
    Quote Originally Posted by Tonycee View Post
    If making trading analysis I try to avoid weak support and resistance levels because they do not qualify to be called a quality support or resistance level that could be followed. I try to eliminate this weak support and resistance level by avoiding small time frames, but instead look at support and resistance level which are in the higher time frame because they are more stronger and quality to follow. Breakout remains a problem for traders who wait for the very support and resistance level to trade reversal and sure they need to understand how to follow the market with less risk.
    It's always the right trading decisions making proper analysis with a strong support and resistance level. But even at that, these levels can appear in lower time frame and still be effective for short term traders. As long as we have a better plan on following this support and resistance levels with the right management, we can always have all that can help us survive in forex. These are levels known to be a turning point in forex and taking note of these levels will increase the way we follow the right trade.

    Not allowed!

Page 1 of 11 12345 ... LastLast

Tags for this Thread

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •