Support and Resistance: Video 19 A, B, C, D & E

Question 1

Define Support

Answer 1

A price below the market where buyers might be stronger than sellers.

Question 2

Define Resistance

Answer 2

A price level that resists rallies. When the market goes to a certain price and sells off.

Question 3

Support and Resistance are also called _______________. Why?

Answer 3

Inflection Points
Because when price gets to a support or resistance level, it can either Breakout or Reverse. The market is making a decision whether to reverse or resume.

Question 4

Types of Support and Resistance

Answer 4

Trend Lines
Trend Channel Lines
Prior Highs and Lows
Round numbers
Fibonacci levels especially 50% PB

Question 5

The market is always paying attention to prior highs and lows, the result is…..

Answer 5

You get a lot of double tops and bottoms. Most are not exact, a lot or little above and below.

Question 6

Round numbers are important for Support or Resistance

Answer 6

Question 7

50% is the single most important pullback level

Answer 7

In a strong rally like this, bulls will place orders to buy at 50% pullback. Betting that the bear reversal will fail and bull trend will resume.
The bull trend continues only it continues to make higher lows.
Al starts the 50% at the tail bottom of a bar.
Bulls buy with limit orders at 50%.