Support and Resistance
Key price levels where buying (support) or selling (resistance) pressure historically causes price to pause or reverse.
What is Support and Resistance?
Support and resistance are key price levels where:
- Support: Price tends to stop falling and bounce up
- Resistance: Price tends to stop rising and bounce down
How They Form
These levels form from:
- Previous highs and lows
- Round numbers (1.1000, 150.00)
- Fibonacci levels
- Moving averages
- Supply and demand zones
Trading Support and Resistance
| Level | Price Action | Common Trade |
|---|---|---|
| Support | Price bounces up | Buy |
| Resistance | Price bounces down | Sell |
| Breakout | Price breaks through | Trade breakout direction |
Using with Currency Strength
Combine support/resistance with our Currency Strength Meter:
- Identify key S/R levels on your chart
- Check currency strength for the pair
- If strength confirms direction, higher probability trade
Key Points
- Old support becomes new resistance (and vice versa)
- Multiple touches = stronger level
- Volume confirms breakouts
- Set stop-loss beyond S/R levels