How To Identify Strong Support & Resistance
ฝัง
- เผยแพร่เมื่อ 5 ส.ค. 2024
- How To Find Strong Support & Resistance
Intro: 0:00
What Is Support And Resistance: 0:24
Static Resistance: 0:57
Dynamic Resistance: 5:35
If you've been watching me, you're well aware that I am a technical trader. I use charts and indicators to make my trading decisions.
In the world of technical traders, some of the first things you learn are support and resistance. These are levels in the markets where the price tends to gravitate towards. A lot of this is simply due to human psychology....we like nice round numbers.
But as I'll discuss during today's session, there are a LOT of opinions on the best method for plotting these levels on the chart, and how to find support and resistance in stocks, and show you the best way to plot support and resistance.
For the most part, there are two types of analysis (or some combination of the two) that traders perform before entering a position:
Fundamental Analysis: This is primarily looking at the financials of a company and making trades or investments based on this information.
Technical Analysis: In this type of analysis you don't pay any mind to the financials and focus only on the charts.
So what exactly are support and resistance? And why should I care about support and resistance levels in my trading? Support and resistance are levels that prices have a problem moving through, with support typically below prices acting like a "floor," and resistance typically above prices acting as a "celling." There are two types of support and resistance: Static, and dynamic.
Static can be a line or can be at an angle. Now with a support line, sometimes called a trend line, is a line where a price bounces off and comes back down to the support line. With a resistance line, this is the line where the price bounces of as it's rising, back down.
There are 3 ways to find strong support and resistance:
1) Zoom out.
2) Focus on the "big support and resistance" lines.
3) The more "touches" the stronger the support/resistance.
Now let's talk about "Dynamic" support & resistance lines. This is where we are looking at moving averages: 50, 100, & 200-day moving averages. There are some downfalls to using these moving averages, & some traders like to use "Fibonacci numbers:" 5, 8,13,21, ... The Static support/resistance lines are usually stronger than the dynamic support/resistance lines.
To wrap it up, finding strong support/resistance lines is both an art, AND a science.
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Do you have a better understanding of how to find strong support & resistance lines after watching this video? What other topics would you like me to cover in another video? Let me know down in the comments below.
Here is a link to The Options Wheel Strategy Playlist:
th-cam.com/play/PLBa3sAx-Io2nosgosERUhIZwzvIgD-3Vq.html
Great information ! Thanks again Markus !
Thank you. Very helpful. :)
Great Summary... Thank you again . Happy Thanksgiving!
Thank you for watching! :)
Very helpful! Thank you!
Hi S Snyder, thanks for watching. And thanks for your feedback. Much appreciated. "See you" in the next video 👍
Very good video Markus! thanks
Thank you for watching!
thank you sir...
Thanks for explaining in detail
Hi Chidhambara Ganesan, thanks for watching. And thanks for your feedback. Much appreciated. "See you" in the next video 👍
I love all of your content. Purchase the book and I just have to say you have been great a great guidance and motivator on my trading journey. Currently on the path to profitability but I have no doubt I am on my way there. Kudos to your programming 👌
Thank you! ;)
Great video, thank you.
Awesome! Thank you for watching! :)
indeed it was pretty helpful... thx
😊 You are welcome! I am glad that this helps!
Great Video!
Awesome! Thank you for watching! :)
Very helpful since I didn't know the moving average was considered a support/resistance strategy when buying long on stocks. I feel more comfortable using the most touch points for the lines.
Yes, the moving average is a "dynamic" support or resistance line. Pretty cool, isn't it? 😀
This was good stuff.
Thank you! :)
Thank you.
😊 You are welcome! I am glad that this helps!
Thanks mate ;-)
Thank you for watching! ;)
Thank you this helped I learned something new today
You are welcome! By the way Sonny have you checked the recent update about my software the PowerX Optimizer yet?
@@rockwelltradingservices i haven’ but I will all I hear is about the power in your videos so I’ll check it out
If you want to learn more you can watch this webinar where we showed the latest update on the software and it's so exciting. Here www.rockwelltrading.com/webinar-replay/new-features/
Thanks and enjoy the Thanksgiving Holiday. 👍
Hi Manuel H, thanks for watching. Have a happy Thanksgiving!
Thanks for the video. Just want to ask what time is best to draw support and resistance. I do day trading on 5 min time frame and also use 15 min time frame for entry and exist.
The larger the timeframe, the stronger the support and resistance. A support and resistance level on a DAILY chart is MUCH stronger than on a 5 min chart. That's why I prefer daily charts. Does this help?
I enjoyed this video almost…..almost as much as I am enjoying a Markus Burger right now..mmmmmm good. Thanks for the education…one day, when I grow up (I’m 52) I want to be like you
LOL - seems we’re the same age! I’m born in November 1969. What about you?
@@rockwelltradingservices January, 1970….like I said…..when I grow up
Do you use this with PowerX strategy? If yes, how you use it? If not, why?
Hi maxburn, I'm using this for "The Wheel" strategy. For the PowerX Strategy, I'm using MACD, RSI and Stochastic. Does this help?
Would this work for day trading as well?
Yes. Support and Resistance are universal. HOWEVER, the larger the timeframe, the more significant. Example: support and resistance on a daily chart are more significant than on a 1 min chart. Does this help? 👍