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How Does Price React At Support And Resi…stance

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Part of the problem with how people use support and resistance is that although most are aware of the different basic ways a market can respond to a technical level, they often are not taking it into account when executing around a level. A market does not have to instantly bounce from a level and this is a dangerous way of thinking that’s easy to get sucked into. A market can breach a level only to turn around and reverse back where it came from.

A technical level of support and resistance is merely a reference point for subsequent activity and this must be at the forefront of a trader’s mind when looking for clues to take their next trade. ROTATION SIZE

Before we get onto how a market can respond to a level, it’s absolutely crucial to cover rotations. A rotation is simply a definable leg within the market movement.

http://www.netpicks.com/how-markets-respond-to-support-and-resistance-levels/ - Read more

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