Now this stuff is absolutely crucial!
Look! Can you spot the differences between these 3 types of SR?
Micro Support & Resistance
Pullback Support & Resistance
Macro support & Resistance
Now. You might often hear me talk about ‘the rhythm of the market’. Look at these 3 depths of market movement and you will spot the ‘rhythm of the market’. The way market reacts to these 3 types of SR will determine the wideness of your stops and targets.
Grasp the rhythm incorrectly – and:
- You will enter too early
- You will enter too late
- Your stop will be too tight and you’ll get stopped out
- You will sell where you should have bought
Have you ever gotten stopped out, only to find that the market goes to the resistance one level deeper, only to find the market go back exactly in your direction?
That happened because price changed it’s rhythm of movement. Or, maybe you misunderstood the rhythm of price movement. In other words, you misunderstood the wideness of its moves. You thought bears were in complete control while actually bears were stronger than bulls BUT they switched roles and the swings in both directions were wide.
It is important to spot the changes in price movement/ price rhythm and what distance of an SR level price is reacting to.
Spot it as early as possible.
All these charts were exactly the same time frame and exactly the same currency pair. But what matters is that the character of the price movement was very different in all 3 cases. This means that if you misinterpret the depth of counter-trend players you will get stopped out prematurely – every single time!!
Want To Follow my Feed? @cannamellia
Subscribe to my mailing list HERE