Support and resistance levels are points in the market where the price has a high probability of reversing. Knowing where these levels form and the reason why they form. Can help you in predicting when the price is likely to reverse and start moving in the opposite direction.
Support and Resistance Levels
I always start drawing my support and resistance levels on the linechart. Because I think that I have more overview where the levels are exactly. Below you can see an example of a line chart and how I determine my support and resistance levels on this line chart.
Linechart Support And Resistance Levels
The Support and resistance levels get their name from what they’re expected to cause the market to do upon being reached. Support levels are supposed to support the market and stop it from moving lower. Whilst resistance levels are supposed to stop the market from moving higher. Thus causing it to resist higher prices. Because support and resistance levels cause the market to do different things. It means they always form either above or below the current market price.
Support levels always form BELOW the current market price. And are points where the market has a higher probability of reversing back to the upside.
Resistance Levels always form ABOVE the current market price and have a good chance of causing a reversal to the downside.
Now look at the example below. Now that I have changed the Linechart in the candlestickchart you see it all a bit better.
We know for sure that these levels are actually support and resistance levels. Because they all caused multiple reversals to take place. And we know that they are specifically resistance levels due to the way they are all found above the current market price.
Support and Resistance Levels
In combination with reading the candlesticks, understanding what a fake out is and how you can recognize it. If you understand what a retest is, and ofcourse good risk managment you can be successful with this strategy. I have outlined the above chart for you. Especially in the way I view the market and act on it. Take advantage of it and keep practicing to read the market perfectly. Just like you will do with a good book.
In the beginning of my trading career, I went through many ups and downs. What really helped me with especially not giving up were the many motivating forex quotes. It can give you just that little extra power or insight. Here is a summary of my favorite forex quotes. Enjoy it!
“You become fearful the moment you identify with fear. But once you begin seeing it as an impersonal changing phenomenon, you become free.” ― Yvan Byeajee.
“Reaching any goal in trading requires specific domain knowledge and technical skills. But then, after that, it’s all mindset management. Yet most people ignore that —they automatically think they have that last part all figured out, and it’s a mistake.” ― Yvan Byeajee
“Trading the markets is a totally self-centered activity. Nobody’s life gets better because you trade. Except your broker’s life.” ― Robert Rolih
“When you learn to let go of the need to be right, being wrong gradually lose its power to disturb you.” ― Yvan Byeajee
“Money is made by sitting, not trading.”
– Jesse Livermore
“That cotton trade was almost the deal breaker for me. It was at that point that I said, ‘Mr. Stupid, why risk everything on one trade? Why not make your life a pursuit of happiness rather than pain?’”
– Paul Tudor Jones
“When I get hurt in the market, I get the hell out. It doesn’t matter at all where the market is trading. I just get out, because I believe that once you’re hurt in the market, your decisions are going to be far less objective than they are when you’re doing well… If you stick around when the market is severely against you, sooner or later they are going to carry you out.”
– Randy McKay
“The key to trading success is emotional discipline. If intelligence were the key, there would be a lot more people making money trading… I know this will sound like a cliché, but the single most important reason that people lose money in the financial markets is that they don’t cut their losses short.”
– Victor Sperandeo
The goal of a successful trader is to make the best trades. Money is secondary.”
– Alexander Elder
“I’m always thinking about losing money as opposed to making money. Don’t focus on making money, focus on protecting what you have” – Paul Tudor Jones.
“If you personalize losses, you can’t trade.” – Bruce Kovner
“It’s critical for the crocodile to understand its prey and to know where to look for it and remain calm and patient until it arrives. As traders, we have to know what our trading edge looks like and where to look for it and then control ourselves enough to not over-trade before it arrives. “- Nial Fuller
“I learned early that there is nothing new in Wall Street. There can’t be because speculation is as old as the hills. Whatever happens in the stock market today has happened before and will happen again. I’ve never forgotten that.” – Jesse Livermore
Want to know more about trading in forex or do you want to join the forex group?
Please contact me so that I can explain you much more about what we have to offer.
How to become a professional trader? The difference between a professional Forex trader and an amateur is like a boxing match between an Olympic champion and your neighbor. A professional trader is able to predict the future better due to good strategies that he or she has developed. The professional trader knows everything about risk management and how to keep himself under control and never get emotions the better of him.
You’ve got to be strong psychologically to make more and more winning trades. You’re not always going to make winning trades, sometimes you will make a bad one. The art of the game is to minimize your loses and maximize your winnings. Sounds simple right? Keep on reading and you will learn how to do this.
“A trader who has never lost, is not a trader yet.” Aristotle.
It’s very important to read and be able to analyze the graphs really well. In the end it is all about recognizing patterns that have occurred in the past and may well be happening in the future again. Remember the Forex market is always on the move.
Technical Analysis for Forex Trading
It’s like dating. You’ve got to get to know the other person really well to press the right buttons for him or her. In trading technical analysis of a certain pair is really important. Get to know the pair your trading to predict any movement in the future. Ask yourself questions as: What is the price at the moment? What was the price? What happened when the price was at this certain level? The answers on these questions will give you a possible outcome in the future. And so a possible right moment to make your trade.
You don’t think this is the only strategy right? Since there are a lot more strategies at use at the Forex market. For example: Drawing trend lines, support and resistance lines, the candlesticks and the different indicators. Every trader uses its own way to analyze the market.
Fundamental Analysis for Trading in the Forex Market
Fundamental analysis is also called the old fashion way since it’s used by traders who mainly focus on the economic news.
The idea of trading of the economic news is that the currency will follow the economic news. It is certainly important since it can change the prices but more than often the Forex market reacts in a different way as expected. Take
the Brexit as an example. This had a bad influence on the value of the GBP. But that doesn’t have to be the case all the time. You will see that traders who trust on fundamental analysis get confused when it goes the other way.
Swing Trading/Trend Trading
Swing trading is, the word gives it away a bit, trading on a swing. Simply, traders are looking for a pair with a predictable big swing ahead.
Swing traders are the hit and run kind of people. They make a trade, get a few percentages profit and close their trade. Most often swing traders are cautious traders. Like a leopard, they wait for the right moment to attack and give it their all when that slightly weak dear is running by.
The swing traders work with the Stop-lossthat protects you from big loses. More about Stop-loss later on.
How to become a Professional Trader? Strategy for a trend trader is pretty plain and simple: Make sure you’re there when it happens and stay as long as you can until the trend reveres. Thought of a trend trader is that the price will keep moving in a certain direction otherwise it wouldn’t be a trend right? If the price, unexpectedly moves the other way it’s not a trend and the trend trader gets out of the hot kitchen before he burns his fingers.
These particular trading styles can be very successful if you have the right patience and know where to go for the kill. Mostly you will go for the kill at a retracement point. I will explain this later on.
-Up Trend: If the trend goes up the Euro is worth more. -Down Trend: If the trend goes down the Euro will lose in value. -Sideways Trend: Prices move in a narrow range.
Day Trading and Scalping
A common style of trading is Day trading. Day Traders are traders who strive to make money on a daily base on the Forex market and make as little as 5 to 10 trades a day.
Day traders who refuse to hold on to their position for one night work with a real tight Stop-loss and hold on to their good positions. For example the EUR/USD pair is the ADHD kid of the class who can’t sit still and is the pair that moves the most. An average of 80 PIPs (More about PIPs in a few moments) a day. So these movements need to be top focus for a day trader.
Scalping is a sort of day trading. Scalpers trade in a relatively short timeframe as five minutes. Every trade they make will be between 5-10 PIPs. Imagine going for a 10km walk. And every 10 meter you find yourself a dollar on the ground. You will finish your walk with a $1,000,- in hand. You see, a lot of small trades will end up being a big one. Scalping is for the thrill seekers under us. It requires constant focus.
How to become a professional trader? Pick the strategy that fits you as a person. If you like to analyze and wait for the right moment don’t go scalping. Other way around. If you are that thrill seeker, don’t go bore yourself with analysis. Start Scalping!
Learn Forex Trading Online – How to Become A Successful Trader
Everyone wants to know how to become a successful trader.
Is there a strategy that makes you very successful? Sure, a good working strategy is very important to be a successful forex trader. But only with a good strategy, you will unfortunately not be successful. There are a few important points to become a successful trader. I will now briefly discuss these points with you.
Good Strategy Of Successful Trader
As I mentioned earlier, a good strategy is very important. Keep testing these especially until you make much more profit than you lose. Get to know the forex pair well, observe this for a while very well so that you know exactly how it moves. Keep practicing your strategy on a demo account or a simulator until it is good enough to go live!
Good Risk Management Techniques
When you don’t have your risk under control at every trade, you simply open the door for the friendly but emotional neighbors to come in and dominate in your house. We promise it’s hard when you start trading at the Forex market. Because it is an emotional market. It’s hard to stop trading emotionally once you’ve started or even admit you’re trading emotionally. The game is about how much you lose or better said how you minimize your losses. Not about your winnings. We all have that gambling friend that always talks about his big winnings. He never tells you about the day he lost $1000 on one hand of Black Jack does he? A good example that shows you how important it is to minimize your losses. You don’t want to lose that $1000 you’ve won with 100 hands, on one hand, do you? So set your losing limit before you trade. This has to be an amount that your completely OK with losing. If you lose it’s just another day at the office.
Become A Successful Trader you have the right Mindset
The truth is a majority of all traders keep losing. There is a simple explanation: They enter the Forex market with wrong expectations. They think it’s a getting rich quick system. Traders like that have the thought by investing a thousand ($1,000,-) they will make $1.000.000 in a week. That’s just unrealistic. The Forex market is not a casino.
This unrealistic expectation can and will work against you and will brush your whole account away in a heartbeat. Again, don’t let emotions get the better of you. Ask yourself the question: “what am I willing to lose?” Always have the rule that you can explain why you make a certain decision. Your thoughts have to be robotic and emotionless.
These are the 3 most important points, of course, there are many more to be successful and profitable. If you have questions you can always contact me. And if you joined the forex boot camp you will, of course, learn all ins and outs!
Learn More About Forex Trading
Want to know more about trading in forex / trader mindset or do you want to join the forex group? The forex group is mainly English! Please contact me so that I can explain you much more about what we have to offer. And all your questions can be verbs.
Some scalpers are already satisfied with 1-5 PIPs. And you actually step out of a certain position very quickly, sometimes even within 5 minutes. A scalp trade is a trade that you can only keep up to 1 hour to get your pips. If you want to scalpe, you first have to look for a good broker. Because not every broker is happy with scalpers and also have certain rules where they do not allow scalping. So first look for a broker that has an attractive spread and where you should not hold a trade for at least a certain amount of time.
There are many traders who do not like scalps at all. The scalping of forex can sometimes go very fast and you should therefore always ensure good risk management. I scalp forex myself for a number of years and i love it! You are active in the forex market and you make a number of trades per day. You can make good money with it if you know what you are doing and which times are best to take a scalp position. In addition to scalping, I also do Swingtrades, but I do this next to them because you often keep them for a longer time for a nice profit.
Do you want to scalpe yourself but do not know exactly how? I will gladly explain everything about scalping. What are the perfect times and what kind of risk management is exactly sensible if you are a forex scalper. Feel free to contact me and who knows you will soon be a forex scalper at the top!
Get Good Forex Signals Service – The Forex Scalpers
Many people are looking for forex signals because if you have found the right signal service you can become very rich. But what if this signal service stops or the forex signals are no longer good? then you have to look for a new signal service and everyone knows that you do not find a good signal service very quickly. Often there are many scammers and they deliver totally wrong signals and then you blow your account!
Of course, this is not the intention, but it happens very often. You pay a nice amount per month for the signals and the signal service promises you golden mountains. A high profit and a minimal loss. Yet you often see the opposite and you blow one account after another account.
Professional Trader advice Signals Services
As a professional trader, I would certainly also advise against signal services, especially if you have no knowledge of trading yourself. Too often I see that the risk management of most signal services is completely wrong. They use a too high stop-loss on the profit they want to achieve. You also do not know if you do not have experience with trading when you can get the best out of a trade. And you follow the predetermined take profit and stop loss indiscriminately. That often goes wrong and you lose a lot of money again! Terrible sin, because if you learn to trade yourself, you have control. And you can earn a lot of money on your own. You know what risks you want to take and rely on your own trade. There is nothing better than making a good analysis yourself and seeing your profits grow.
My advice is therefore to never just get a signal service, if you do not know what trading forex means. First learn the basics of trading. And grow from there!
Want to know more about Forex Trading or do you want to join the forex group? The forex group is mainly English! Please contact me so that I can explain you much more about what we have to offer. And all your questions can be verbs.
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