Support and Resistance Levels

Look at the diagram above. As you can see, this zigzag pattern is making its way up (a “bull market”).

Resistance levels indicate where there will be a surplus of sellers.

Support levels indicate where there will be a surplus of buyers.

The reverse is true during a downtrend.

Trade the “Bounce”

• Buy when the price falls towards support.
• Sell when the price rises towards resistance.
• Sell when the price breaks down through support.

Buy when the price breaks up through resistance.