Attached is a EU 5M chart with 1H MM levels on it…Lemme take this one by one…..lets go to the first circle…in that, you see that price breaks thru resistance…but it does not run away…so you can wait for the retracement and when the retracement comes youu see how it goes….the retracement carries price just below support and then stops and stalls….youu also see a small pin bar…so you know that some support is building and maybe you could risk a small long…as expected, after stalling, it goes up again, breaks the resistance again and then you see a long bar and again a retracement back to support…this time, the retracement does not break the support and soyo u can take this as confirmation that the resistance has been broken…if the retracement had taken the price below support, then the break was false…
now on to the second circle…in this, there is a long bar which breaks the resistance and then price retraces back to the resistance turned support but does not go below the support…again you see a bullish pin bar as well..a retracement after a break above resistance with retracement not going below resistance turned support and a pin bar…all classic signs to tell you that the break is genuine and then you go long…
lets move on to the third circle…at the beginning of the circle is the first attempt at breaking the resistance which fails…you can see high volume bars in the attempt to break and then the volume falls off after the failure to break…then you see a bearish pin bar as well..someone is trying to push the price down….then you see another attempt to break the resistance with normal volume…this time it breaks and maybe you go long…it would be better if you waited for the retracement….as expected, the retracement comes along which goes below resistance turned support but pulls back above the resistance turned support…so you enter long thinking that it is a good break…but then as you watch PA, you see that the high of the previous break is not broken and price starts falling down again….this is a sign that the up move is weak and is an indication for u to exit longs at BE or with minimal loss.
You can catch me on twitter (http://twitter.com/ns_karthik) where i share some of my trade calls as well !!
Latest posts by admin (see all)
- Forex Trading in Summertime, what the charts can tell you. - September 22, 2017
- The Secret of Taking Profit and Why it is Important - September 20, 2017
- Fading the Momentum in Forex Trading - September 14, 2017
Winner’s Edge Trading, as seen on: