Hello guys, today’s topic is very important about support and resistance. This is the common problem of all the newbies about How to verify a Break of Support and Resistance or it is a false breakout. Many times you have to face the problem that when you enter the trade on support and resistance market reverses immediately and your dreams are broken instantly when you see your capital losing.
It happens a lot of time with me when I was newbie and in learning- phase same like you. Most of the time we see that market break the support and resistance and we immediately think!
Ohh Waooooo! Support and Resistance has been broken now market will move in broken direction but when you enter the market according to broken direction then market reverse and moves opposite to your trade and hit your stop loss. So learntotradeinurdu team is here for you to identify this common problem and presenting to you solution.
- Draw support and resistance according to level I tolled you before
- Closely watch the market movement according to your drawn support and resistance.
Now come to the solution of the said problem.
A most important thing to remember always use a reliable forex trading borker which candles give you clear direction of the market. If a candle close below or above the support and resistance shows that it have broken. Now the main thing is that how we determine that the broken key level is valid or not. I will reveal the secret about how to verify the broken support and resistance.
- After closing the candle above or below the resistance and support we will take closely eye on the second day candle (in this example I am using daily time frame as we know that higher time frame have more validity rather than short time frames).
- If the second day candle break the last day candle high and close above the high then on next direction of the market will be towards broken side. This was a secret which many forex traders did not tell you but in paid courses. When the market closes above the high of last day candle then market will move to the level of next resistance and if the very next day candle did not close the above the high of the last candle then market will reverse and you can enter in the market with more confidence.
In the last of this article one more thing I recommend to you that always do practice each thing you learn from my or any other website. If you not practice you will not learn and you will lose your hard earned capital. First practice on demo and then put your learned knowledge on your real account. If you like this lesson then share it with your friends and like and don’t forget to subscribe my channel learn to trade in urdu on YouTube or my website news letter.
Happy Trading Journey 🙂