Support/resistance levels. How do I identify them? - page 4
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It's all clear to you ))
Good luck.
That's my point exactly... Buyers and Sellers alike... and the price for TWO YEARS has been going strictly in one direction...
So what does supply and demand have to do with it?
You have read too much Western junk and your brains have stopped working altogether!
the price is not driven by petty traders, the price is controlled by supply and demand of market participants who convert money into money and use this money to buy or sell commodities or raw materials... If you think otherwise, then you are free to do so.
At the moment when the direction of the quotation on the chart changes, a support or resistance level is formed. The longer the level is on the chart, the more one market participant dominates the other.
Thus,the definition of the Resistance levelappears- it is the place where the bulls' dominance over the bears has been broken.
A Support level is where the dominance of the bears over the bulls has been broken.
Specifically on the merits. Great.
There is a definition, but it sounds rather vague.
Let's try to formulate it further:
A resistance/support level is a range of quotes near an extremum with a higher probability of price reversal as compared to subsequent incoming quotes, when prices return to that range.
Accordingly, to clarify the distinction
Resistance level- a range of quotations near the extremum of the smallest quotation.
Support level- a range of quotations near the extremum of the most significant quotation.
Specifically on the merits. Well done.
We have a definition, but it sounds rather vague.
Let's try to formulate it further:
A resistance/support level is a range of quotes near an extremum, which has a higher probability of reversing its direction when prices return to that range, as compared to subsequent incoming quotes.
Why a range? The level has a precise, specific value, and the important thing is that at this value the dominance broke down, but it was in the past, so when the price approaches this value again, it's not certain that this level will hold, it just turned around in the past, but now, not certain, so further we connect more filters, reversal candles, indicators... It's a matter of what you are good at.
Specifically on the merits. Great.
There is a definition, but it sounds rather vague.
Let's try to formulate it further:
A resistance/support level is a range of quotes near an extremum, which has a higher probability than subsequent incoming quotes of reversing their direction when prices return to that range.
Here is a description of the process of how the trade of those who actually convert one currency to another takes place, i.e. his train of thought
Let's say I am a banker and I want to sell euro. The current rate is 1.2136. I put a lot to sell at this price. The lot is bought. The next lot is at a price of 1.2141. And this lot is bought. The next lot is put up at the price 1.2146. Bought. The next lot was priced at 1.2151 - they didn't buy it, it was too expensive and nobody needed it at that price. Then I decreased the price to 1.2146. They bought. I raised the price to 1.2151. It was not bought. I lowered the price to 1.2146. Bought. It went up again. And so several times. And then they did not buy at 1.2146. I lower it again to 1.2141. It is not bought again. I drop to 1.2136. And a resistance level of 1.2151 has already formed. If there is now a group of players who are willing to buy at 1.2136, the next level is about 1.2136. If this group is small, the level will not last long. If it is large, the level will be strong. And it is quite possible. After all, for large players a 10- to 15-point decrease in price is already good. And the increase in the number of black candlesticks near the resistance level indicates that the number of those who want to buy at this price decreases and the sellers have to reduce the price in order to sell. And when the level is broken through? For example, when a group of players appears in the market and decides (no matter what the reason) that the price will go up and it is urgent to buy before it rises too much. If the group is large and the reason is good, the price will go to the next level, but if not, it will be a false-break.
The point is that the decision to convert is influenced by a factor such as necessity, if it starts to tighten then the convertor doesn't look at the price, he just exchanges because if he doesn't, he's screwed.Why a range? The level has a precise, specific value,
Now that's interesting. The internet teaches that only lines can have a specific value. Therefore, a price line is a sloping (trending) line, which at each specific time interval (candlestick) gives a specific one value.
And a level is an undefined price range where action (rebound, breakout, consolidation) takes place.
What do you think about it?
so when price approaches that value again, it's not certain that the level will hold, just that it turned around in the past and now, it's not certain,
That's what I've included in the definition.
having a higher probability than subsequent incoming quotes of reversing their direction when prices return to that range.
And calculating probability is a wait, early))
Ivan, I know one property. Levels are a horizontal area where the price is less frequent than elsewhere.
There! Area = range. I see these concepts most often too. But, area is too vague, and range is probably a more literate sounding, more appropriate definition.
But, area is too vague, and range is probably a more literate sounding, more appropriate definition.
Here is a description of the process of how the trade of those who actually convert one currency to another takes place, i.e. his train of thought
Let's say I am a banker and I want to sell euro. The current rate is 1.2136. I put a lot to sell at that price. The lot is bought. The next lot is at a price of 1.2141. And this lot is bought. The next lot is put up at the price 1.2146. Bought. The next lot was priced at 1.2151 - they didn't buy it, it was too expensive and nobody needed it at that price. Then I decreased the price to 1.2146. They bought. I raised the price to 1.2151. It was not bought. I lowered the price to 1.2146. Bought. It went up again. And so several times. And then they did not buy at 1.2146. I lower it again to 1.2141. It is not bought again. I drop to 1.2136. And a resistance level of 1.2151 has already formed. If there is now a group of players who are willing to buy at 1.2136, the next level is about 1.2136. If this group is small, the level will not last long. If it is large, the level will be strong. And it is quite possible. After all, for large players a 10- to 15-point decrease in price is already good. And the increase in the number of black candlesticks near the resistance level indicates that the number of those who want to buy at this price decreases and the sellers have to reduce the price in order to sell. And when the level is broken through? For example, when a group of players appears in the market and decides (no matter what the reason) that the price will go up and it is urgent to buy before it rises too much. If the group is large and the reason is good, the price will go to the next level, but if not, it will be a false breakout.
The point is that the decision to convert is influenced by a factor such as need, if it starts to get tight then the converter doesn't look at the price, he just exchanges, because if he doesn't, he'll get screwed.That is, you insist on the level as a specific value. From the description it makes sense