Following the trend with support and resistance

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• It is always important to understand who is in control at the moment, buyers or sellers, and be aware that the trend can change very quick so its key to adapt and don’t have a bias. After you know what the trend is, then you can mark a high probability support or resistance level in different time frames.
• In an up trending currency, a support will always have a higher probability of holding and the resistance will not be too reliable, the opposite happens in a down trending currency. Also notice that when a resistance level in a uptrending move works, the pullback has low probability of creating new lows (lower lows) meaning it is not a strong move down, it could just be testing lower prices for liquidity and to continue the move up.
• It is common to see that a resistance once broken tends to be support and a support once broken tends to be resistance. This is a good spot to have a continuation of the trend (see example below).
• Support and resistance levels in high time frames like 6hr, daily and weekly that are strong pivot points can be known as key levels. These levels act as historical levels which means that have been relevant since months even years ago. These levels can change the trend.
• Price action around support and resistance levels can be similar to the price action at supply/demand zones (read "How to identify high quality Supply and Demand zones" link below), where price reaches the level with strength and then rejects, volume increases with no follow through and the candle closes with a wick but never below/above the support/resistance level.
• Also it is common to observe that price gets near a support/resistance area and breaks below/above, grabs liquidity and then comes back above/below the area. In this cases, enter the trade after it regains the level.



https://www.tradingview.com/chart/BZ1!/X6M18spi-How-to-identify-high-quality-Supply-and-Demand-zones/

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Bình luận

Here is an example of an uptrending commoditie like Brent futures. previous high time frame resistance becomes new support when the future is uptrending.


This is to show that it happens in all time frames, same Brent futures, smaller time frame where resistance becomes support offering a good entry for a long. remember to always go with the trend, in uptrending markets long supports and in downtrending markets short resistance.