3.5 Recap – Trading Support and Resistance

Resistance and support in Forex are like barriers on either side.
 
Let’s pause and see a replay of the concepts of support and resistance though on a general note both try to stop the price action to send it to the other direction.
 

Support

 
‘Support’ is an area where one can see buying emerging, and in enough volume to put a halt to the preceding slide in prices. 
 
It’s useful to remember it simply as a point where a falling market made its last turn before reversing upwards.
 

Resistance

 
‘Resistance’ is the reverse of support – a zone where rising prices meet a wall of selling orders, enough in volume to halt the uptrend.
 
It’s useful to remember it simply as a point where a rising market made its last turn before reversing downwards.
 

Jekyll and Hyde

 
Support could become resistance in the future, and vice versa.
 

Trends

 
Trends can be up, down or sideways. Draw an uptrend line by joining the bottoms made by the price action. Draw a downtrend line by joining the tops. 
 

Channels

 
Channels are price action areas enclosed between the basic trend line and the return line. A rising or ascending channel is made by drawing a parallel line to the basic line and anchoring it the recent price top. A falling or descending channel is made by drawing a parallel line to the basic line and anchoring it to the recent price bottom.
 
 
Previous Lesson Next Lesson

 




 

  • Recap of Support and Resistances
   

   

Forex Trading Alerts subscription


Name:
Email:
Confirm Email:
0+6

We will send email alerts as soon as the Forex analysis is updated.
Request you to check the Junk (spam mail) folder immediately in case Google group mail is not received in Inbox.

Enter Forexabode Blog

Enter Forex Abode Community

Forex Rates