Unlock The Markets: With Support And Resistance Trading [Ultimate Guide]

key to your trading success

Most new Forex traders don’t use or don’t understand the use of support and resistance trading. If you are one of these types of traders, then you’re in the right place!

In my trading lesson today I will cover all the aspects you need as a new trader. When it comes to unlocking the markets and understanding support and resistance trading.

Having a solid Forex trading education on the basics of support and resistance trading, is the starting point for any successful trader.

The different types of support and resistance trading I use that I will be sharing with you today –

  • Horizontal level of price resistance
  • Horizontal level of price support 
  • Resistance becomes a support
  • Support becomes a resistance
  • Sideways and dynamic support and resistance

Horizontal Level Of Resistance

Using a horizontal level of resistance with support and resistance trading:

Support and resistance trading with a horizontal level of resistance. Will always act as a reversal point on the chart when selling.

This can be in a sideways moving market (range bound market), or with the trend direction (trade with a bearish trend).

Price Resistance

A major area of price resistance is a level or an area on the chart at which a supply will overwhelm an existing demand.

In other words, this is an area on a chart when the selling at the supply which was light, begins to overwhelm the buying.

For you this then offers an unique selling opportunity, to sell from the resistance on the price chart.

The key thing to always remember is that resistance can always be defined by the following term. (A current high will revisit a prior high).

A resistance can be seen on a price chart as stated above when price revisits a prior high.

On the example below this shows a retest on several occasions at a prior high, with giving you an opportunity to sell.


Price Resistance

Horizontal Level Of Support

Using a horizontal level of support with support and resistance trading:

Having the basics of support and resistance trading with a horizontal level of support. Will always act as a reversal point on the chart when buying.

This can be in a sideways moving market (range bound market), or with the trend direction (trade with a bullish trend).

Price Support

A major area of price support is a level or an area on the chart at which a demand will overwhelm an existing supply.

In other words, this is an area on a chart when the buying at the demand which was light, begins to overwhelm the selling pressure.

For a trader this then offers an unique buying opportunity, to buy from the support on the price chart.

The key thing to always remember is that support can always be defined by the following term. (A current low will revisit a prior low).

A support can be seen on a price chart as stated above when price revisits a prior low.

On the example below this shows a retest on several occasions. At a prior low, with giving you an opportunity to buy.


Price Support

Resistance Becomes A Support

Using a resistance becomes a support with support and resistance trading:

In this next step of support and resistance trading. I am going to cover the aspect of when a resistance becomes a support and vice versa.

This section of my trading lesson is very important to understanding how I trade the markets.

With using what is called a Forex Swing Trading strategy. If this is something you would like to learn more about then check out another trading lesson of mine with:

“Forex Swing Trading: My Ultimate Guide [2019] +PDF Blueprint”

With the basics of support and resistance trading. A resistance will become a support when buyers (demand) overwhelms sellers (supply).

With price being able to breakout of resistance, as just like a horizontal level price then will reverse of the newly formed level of support.

Price Resistance Turns To Price Support

A level or area of resistance once broken, can then become a level or area of support.

Just as the horizontal level of price resistance or support. You would look for any trade opportunities to come of the new support.

For this to happen the buyers (demand) would first have to overwhelm the sellers (supply) for the resistance to be broken.

Then on the move back into the broken resistance you would look for signs of buyers (demand) once again to take control.

A broken resistance to become support can be seen on a price chart as stated above.

On the example below this shows a retest of the broken support after breaking the resistance giving you an opportunity to buy.


resistance became support
Major Resistance Becomes Support

minor support in uptrend
Minor Resistance Becomes Support

Check out what a resistance becomes a support looks like on a price chart…


support and resistance trading with a resistance becomes support price chart
Resistance Becomes a Support

Support Becomes A Resistance

Using a support becomes a resistance with support and resistance trading:

Using support and resistance trading a support will become a resistance. When, sellers (supply) overwhelms buyers (demand) with price being able to breakout of support.

As just like a horizontal level price then will reverse of the newly formed level of resistance.

Price Support Turns To Price Resistance

A level or area of support once broken, can then become a level or area of resistance.

Just as the horizontal level of price support or resistance. You would look for any trade opportunities to come of the new resistance.

For this to happen the sellers (supply) would first have to overwhelm the buyers (demand) for the support to be broken.

Then on the move back into the broken support you would look for signs of sellers (supply) once again to take control.

A broken support to become resistance can be seen on a price chart as stated above.

On the example below this shows a retest of the broken resistance after breaking the support giving you an opportunity to sell.


support became resistance
Major Support Becomes Resistance

minor resistance in a downtrend
Minor Support Becomes Resistance

Check out what a support becomes a resistance looks like on a price chart…


support and resistance trading with support becomes resistance price chart
Support Becomes a Resistance

Sideways and dynamic support and resistance

Also using the basics of support and resistance trading. You can find either a sideways (range bound) or dynamic (trend) level or area of support and resistance.

So in this final part to my trading lesson today, I will cover exactly how these patterns construct and will look on your charts.

Sideways (Range Bound) Support & Resistance

Just as the price resistance and price support levels discussed earlier, you can find price trapped within the two.

Causing a sideways market or more commonly known as a range.

This will show that neither the buyers (demand) or the sellers (supply) have full control of the market unlike a trend.

In other words each time the sellers push price into the support.

The buyers (demand) will overwhelm the sellers (supply) reversing price back up to the resistance.

Where the sellers (supply) will overwhelm the buyers (demand) which creates the whipsaw effect.

On the example below shows how this whipsaw effect will look, when price gets trapped between a support and resistance level.


Sideways Market

Check out what a sideways market looks like on a price chart…


support and resistance trading with a sideways market price chart
Sideways Market

Dynamic (Trending) Support & Resistance

How a dynamic support and resistance forms:

Just as the sideways market, price will be trapped within a diagonal channel of support and resistance.

On a price chart this will be outlined by using two trend lines. Marking the lows and highs of the swinging pattern in the trend.

In a up trending market the support will act as the dominate level or area on the chart. When buyers (demand) will overwhelm the sellers (supply) as price swings higher.

In a down trending market the resistance will then act as the dominate level or area on the chart. Where sellers (supply) will overwhelm the buyers (demand) as price swings lower.

On the examples below, these will show how the support and resistance would look on a chart with a up trend and down trend channel.


up trend channel
Up Trending Market

downtrend channel
Down Trending Market

Check out what trending markets look like on a price chart…


support and resistance trading with an up trend price chart
Up Trending Market

support and resistance trading with a downtrend price chart
Down Trending Market

Find more basics of Forex trading here

Final thoughts

With a much better understanding now of support and resistance trading within this trading lesson today. You should now know when to expect the market to turn at a key area on the chart.

You will now know when the market is in a range bound market or a trending market using the outer boundaries.

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