Support and resistance levels, what they are and how to extract them.
Supports are places from which the price bounced up to form a bottom.
As for resistance, they are places from which the price bounced down to form a peak .
Its benefit:
Supports and resistances are places that can be entered from after they are formed
Especially if the evaluation of those levels is strong, then the trader can
Placing pending orders or waiting for price behavior that supports entering them.
How to evaluate support and resistance levels:
Levels are evaluated in several ways, including the number of retracements
In addition to the shape of the rebound from those levels.
Strong evaluation: whenever the price rebounds from those levels with a strong price movement
With large candle sizes, in addition to the price moving a large distance
Then these levels will be strong regardless of the number of times we bounce from them.
Weak evaluation: The price rebounds from those levels with small candles
With weak price movement, in addition to the price bouncing back from it many times in the same way
Then these levels are weak and are expected to be broken.
Which one would you rather rely on more?
It is preferable to rely on support more than resistance during an uptrend
Conversely, it is preferable to rely more on resistances than supports
This is during a downtrend.
It is very important to analyze the general trend before determining supports and resistances.
