August 4, 2011
- in Uncategorized by schooloftrade
Major vs. Minor Support and Resistance levels for Day Trading
Major vs. Minor Support & Resistance
· Support is a level below the current price
· Resistance is a level above the current price
There are two different types of support/resistance
· Static = never changing, always the same
· Dynamic = always changing, always different
Major = slower timeframe levels that are expected to be the strongest.
Minor = faster timeframes and are not expected to be very strong. They will not hold up when price tries to break them.
You can have dynamic major support, and static minor resistance. There are many different ways to use Support and resistance.
Examples of….
Major S/R:
· 89Range Swing highs and lows
· 55Range Swing highs and lows
· 34Range Swing highs and lows
· 89/55/34range Trend Line
· 89/55/34 Price Channel Highs/Lows
· 89/55/34 Price Wedge Highs/Lows
· High of Day
· Low of Day
· Previous High of Day
· Previous Low of Day
· OPEN/CLOSE
· BMT (Big Money Trigger Line)
· Double-tops/bottoms from a slower timeframe
I use the major levels as my target AREAS to then look for an opportunity to trade with a price pattern.
“Around the AREA of 91.27 I am looking to get long, to buy the support”
Now we need to wait patiently for the price to come to that AREA, and then when we get there we use the MINOR LEVELS of support/resistance to enter the trade.
Minor S/R:
· 13/8/4Range Swing highs and lows
· 13/8/4Range Trend Line
· 13/8/4Range Channel Highs/Lows
· 13/8/4Range Price Wedge Highs/Lows
· Use the faster timeframe the same way you would on the slower timeframe, but use these to find your entry.
Tape Reading using Time & Sales (anthony)
Watch this video for the basics of tape reading.
· Green = buyers
· Light Green = lots of buyers
· Red = Sellers
· Dark Red = lots of seller
“Buy the Lows and Sell the highs”
· Sideways range highs and lows
· HOD/LOD
· Swing Highs, Swing Lows
