📌📌📌 How to tell when Support or Resistance will break — so you don’t get “trapped”
The takeaway is this:
👉🏾 Support tends to break in downtrend
👉🏾 Resistance tends to break in uptrend
👉🏾 Support and Resistance tend to break when there’s buildup
Here’s why…
👉🏾 Support tends to break in downtrend
👉🏾 Resistance tends to break in uptrend
👉🏾 Support and Resistance tend to break when there’s buildup
Here’s why…
❌❌ Resistance tends to break in uptrend
Here’s a fact:
For an uptrend to continue, it has to consistently break new highs. Thus, shorting at resistance is a low probability trade.
Instead, going long at Support is a better trade.
Here’s a fact:
For an uptrend to continue, it has to consistently break new highs. Thus, shorting at resistance is a low probability trade.
Instead, going long at Support is a better trade.
❌❌ Support tends to break in downtrend
Likewise:
For a downtrend to continue, it has to consistently break new lows. Thus, going long at support isn’t a good idea.
But, going short at Resistance is a great idea.
Next…
Likewise:
For a downtrend to continue, it has to consistently break new lows. Thus, going long at support isn’t a good idea.
But, going short at Resistance is a great idea.
Next…
❌❌Support and Resistance tend to break when there’s buildup
Consider this:
Support is an area with potential buying pressure. So, the price should move up quickly, right?
Now… what if price didn’t move up and instead, consolidates at Support?
What does it mean?
A sign of weakness as the bulls couldn’t push the price higher.
Perhaps there’s no buying pressure or, there’s strong selling pressure. Either way, it doesn’t look good for the bulls and Support is likely to break.
An example:
Consider this:
Support is an area with potential buying pressure. So, the price should move up quickly, right?
Now… what if price didn’t move up and instead, consolidates at Support?
What does it mean?
A sign of weakness as the bulls couldn’t push the price higher.
Perhaps there’s no buying pressure or, there’s strong selling pressure. Either way, it doesn’t look good for the bulls and Support is likely to break.
An example:
📍📍📍A Support and Resistance trading strategy that lets you profit from losing traders
Here’s a fact:
Support and Resistance attracts a lot of attention from traders. There will be some looking to trade the reversal, and others looking to trade the breakout.
Since trading is a zero sum game… for reversal traders to profit — breakout traders must lose. And for breakout traders to profit —reversal traders must lose.
Do you understand?
Good.
Here’s a fact:
Support and Resistance attracts a lot of attention from traders. There will be some looking to trade the reversal, and others looking to trade the breakout.
Since trading is a zero sum game… for reversal traders to profit — breakout traders must lose. And for breakout traders to profit —reversal traders must lose.
Do you understand?
Good.
Now… let’s learn a Support and Resistance trading strategy to profit from breakout traders.
Here’s what you need to do:
👉🏾 Mark your areas of Support & Resistance (SR)
👉🏾 Wait for a directional move into SR
👉🏾 Wait for price rejection at SR
👉🏾 Enter on the next candle with stop loss beyond the swing high/low
👉🏾 Take profits at the swing high/low
Here’s what I mean…
Here’s what you need to do:
👉🏾 Mark your areas of Support & Resistance (SR)
👉🏾 Wait for a directional move into SR
👉🏾 Wait for price rejection at SR
👉🏾 Enter on the next candle with stop loss beyond the swing high/low
👉🏾 Take profits at the swing high/low
Here’s what I mean…
4. Enter on the next candle with stop loss beyond the swing high/low