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Support and Resistance lines

One of the most simplest technical analysis is drawing support and resistance lines.

Support lines are areas where the price seems to bounce up when reached.

Resistance lines are areas where the price seems to bounce down.

Notice i mentioned areas as the lines are usually not to the very pip. It is usually around the area. This is a common mistake for many.

Zoom to any time frame you wish and you will notice prices respecting such lines. The longer the time frame, the more valid the line will apparently be.

When a price does indeed break a support or resistance line, it will now function as the opposite. IE. Support lines when broken becomes resistance.

Support and resistance lines are usually used by traders as a warning to take special care as the price will usually react in that area.

As of all technical analysis, these are not standalone solutions. Combine them with other analysis. You can check out my post on RSI too.

I have attached an example of support line below. Picture from babypips.com.

Trade safe 🙂


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