Technical Analysis Training Course and Several Support and Resistance Patters that are Common
When it comes to support and resistance, the market can react in a lot of different ways …
As you pursue your technical analysis training, the following are some patterns that can be observed when that happens in the market .
One that may be called touch and away as if the market is reaching, reaching, reaching for a certain level of support/resistance , and then when it gets in that vicinity , it reverses suddenly and retreats , as if some pressure was built up and released. This is known as an exhaust. Resistance level holds in this formation . It is a pattern that seems like it is trying to break its way through , by “chewing” or “worrying” the support or resistance level like a dog might chew a bone , but it doesn’t work out, and it doesn’t get through , and instead the market turns suddenly and goes in the direction opposite.
The second major way that support/resistance gives way is when prices jump through the anticipated level of resistance and go up even higher . The gap, or as we call it, the “pop” can happen suddenly and can be surprising to traders. With today’s markets that are 24 -hour and the trading platforms that are electronic there are fewer gaps like this that occur since trade occurs overnight and not a lengthy period of no trading . Nevertheless gaps can still occur , and trading them is important knowledge. The thing to remember when taking technical analysis training course is that after it is broken, resistance becomes support and support becomes resistance . Usually the previous support and resistance will be tested by the new prie level and then will go on up in the pop’s direction.
The third major way that support and resistance breaks down is that prices simply slice through the anticipated barrier like a knife through a bowl of jelly , like there was no support or resistance even there …. and that’s exactly what occurs . Price cuts through fast . We see this most often when we anticipate support or resistance on one time frame but on a higher time frame there is nothing that backs it up . One example is that if the daily shows resistance but there is nothing yet on the weekly chart – we should be on alert .
This information is an important part of technical analysis training course – when in reality, the phenomena you believe is there, really isn’t. This is a situation where support is showed by the technical analysis of the lower time period , but it does not exist in the real world , or even if it really exists it is weak and there is no real market effect . The astute multiple-time-period-trader will be alert to this situation because setting up in the area there won’t be higher time period tools . The good news is that it can be seen fast and you can quickly see the negative pattern and there is not any resistance or support occuring in the area.
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