How to read a chart - Putting SR / SD in perspective | Forex Factory

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How to read a chart - Putting SR / SD in perspective

  • #1
  • First Post: Aug 28, 2017 5:29am Aug 28, 2017 5:29am
hello,

in this thread i'm going to shed some light on how to read a price chart.
there's a lot of hocus pocus and conspiracies going about when it comes to trading.
i hope i can clear the dust for some, and show you the only thing that ever really worked for me.

what you'll find here:

  1. how to read a trend
  2. how to read momentum
  3. how to differentiate between cheap & expensive prices
  4. how prices turn
  5. how levels work


what you won't find:

  1. a get rich quick system
  2. indicators
  3. a step by step guide


i'm sure most of you have some experience with sr & sd techniques, and like most things in trading, they kind of work.
they don't work to the extent though that you can consistently make money off of them. at least that was my problem with most sr/sd strategies.

took me a long time to realize that drawing levels on a chart is only like 10% of the process. and that it doesn't matter exactly how you draw your sr or sd levels, as long as you see them kind of work. to trade it profitably, you need to understand how to read a chart.

you won't need any indicators, or templates to follow this thread. a simple bar or candlestick price chart will be enough.
i'll do my best to keep the thread running with live time charts, although i'd recommend everyone to make use of their chart history.

the charts i'll post in here will be futures & spot fx.
feel free to ask questions.

good luck everyone

  • #2
  • Aug 28, 2017 5:38am Aug 28, 2017 5:38am
gold was priced expensive above 1298.7 weekly, which is why it has slowed down a little last week on a new high.
the 1306.9 h4 high caused a shorter term down trend down to 1281.3.
1302.7 could therefore sell, especially if 1303.4 holds. i am not interested in it because on the bigger tfs, h6,h8,daily we couldn't really price into new lows yet.
still playing longs. momentum will be key to assess.

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  • #3
  • Aug 28, 2017 6:28am Aug 28, 2017 6:28am
@ $1277, does that red line denote a demand zone? Whereas the 2 green lines are support and resistance? Looking forward to this thread.
An eternal student.
  • #4
  • Aug 28, 2017 7:08am Aug 28, 2017 7:08am
Quoting gestuntsey
@ $1277, does that red line denote a demand zone? Whereas the 2 green lines are support and resistance? Looking forward to this thread.
hi gestuntsey,
welcome aboard

my green lines are h4-h8, red h12-weekly levels. i don't differentiate between sr and sd, they're just different words to describe the same thing
looking forward to your posts
  • #5
  • Aug 28, 2017 7:18am Aug 28, 2017 7:18am
pound yen coming off 139.55ish daily, could target 142.45ish , 143.2ish eventually if trend & momentum can be maintained on the lower tfs.
141.55ish & 141.70ish could continue the htf selling. will wait for intraday res to establish

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  • #6
  • Aug 28, 2017 10:42am Aug 28, 2017 10:42am
Quoting 89ks
gold was priced expensive above 1298.7 weekly, which is why it has slowed down a little last week on a new high. the 1306.9 h4 high caused a shorter term down trend down to 1281.3. 1302.7 could therefore sell, especially if 1303.4 holds. i am not interested in it because on the bigger tfs, h6,h8,daily we couldn't really price into new lows yet. still playing longs. momentum will be key to assess. {image}
as stated above, no new htf pricing for cheaper prices, thus longs still the safer play. momentum keeps on maintaining the trend.
if this keeps on ripping 1325.5ish will be a scalp at best, not really interested as of now

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  • #7
  • Aug 28, 2017 10:59am Aug 28, 2017 10:59am
All I use is support and resistance. If anyone is interested in how I trade you can follow some of the trades I post on tradingview. Will try to post more this week. I have another business that I run besides just trading so I get busy sometimes.
  • #8
  • Aug 28, 2017 11:08am Aug 28, 2017 11:08am
let oil slow down a little and we should bounce somewhere in the 80s-60s. momentum will be key to assess
htf i'd argue we're shifting downward a little. willing to play the bigger range still

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  • #9
  • Aug 28, 2017 11:11am Aug 28, 2017 11:11am
Quoting Madinvestor
All I use is support and resistance. If anyone is interested in how I trade you can follow some of the trades I post on tradingview. Will try to post more this week. I have another business that I run besides just trading so I get busy sometimes.
hello,
join the forces, post your charts
  • #10
  • Aug 28, 2017 11:45am Aug 28, 2017 11:45am
Nothing wrong with using a few and simple indicators and annotations imo. I use mainly MAs with pivot levels or zones, e.g. S/R and Fibs. Here's is a daily chart of EURGBP. It shows that as long as the inner support trendline (magenta colour) is not breached, you continue buying. But as the price is too far from the MAs, you may expect a retracement soon. Besides, the next significant resistance zone is around the 0.93194 area (purple coloured bold horizontal line) so you watch how price reacts at that level. It may retrace or reverse. The outer trendline (navy colour) is a target to watch and trade southward toward if the inner trendline is broken.

Trade safe and prosper.

KP

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Do your homework, follow the footprints of smart money
  • #11
  • Aug 28, 2017 11:55am Aug 28, 2017 11:55am
And how do you buy? You buy after a retracement to a significant intraday support zone or in an area of confluence.

KP

Quoting KeenPips
...a daily chart of EURGBP. It shows that as long as the inner support trendline (magenta colour) is not breached, you continue buying....
Do your homework, follow the footprints of smart money
  • #12
  • Aug 28, 2017 12:36pm Aug 28, 2017 12:36pm
Quoting KeenPips
Nothing wrong with using a few and simple indicators and annotations imo. I use mainly MAs with pivot levels or zones, e.g. S/R and Fibs. Here's is a daily chart of EURGBP. It shows that as long as the inner support trendline (magenta colour) is not breached, you continue buying. But as the price is too far from the MAs, you may expect a retracement soon. Besides, the next significant resistance zone is around the 0.93194 area (purple coloured bold horizontal line) so you watch how price reacts at that level. It may retrace or reverse. The outer...
welcome to the party
whatever works for you. if you make money happy days
  • #13
  • Edited 9:13am Aug 29, 2017 8:30am | Edited 9:13am
Quoting 89ks
pound yen coming off 139.55ish daily, could target 142.45ish , 143.2ish eventually if trend & momentum can be maintained on the lower tfs. 141.55ish & 141.70ish could continue the htf selling. will wait for intraday res to establish {image}
front ran 141.55ish by 10ish pips, and reached targets below 140.45ish to make prices cheap relative to the intermediate up trend.
should stay above 139.8ish to maintain this up move. 139.55ish could bounce. momentum will be key.
did not get in myself, kim jong un was quicker than me. got a couple of other trades though.

might consider this a front run on the daily. 139.5ish would be the target of that move, second target below 139.28.
cheap prices below 138.62.

if it comes back any time soon to 141.67ish i'll play intraday res. no momentum shiftin htf allowed though

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  • #14
  • Aug 29, 2017 12:57pm Aug 29, 2017 12:57pm
Quoting 89ks
let oil slow down a little and we should bounce somewhere in the 80s-60s. momentum will be key to assess htf i'd argue we're shifting downward a little. willing to play the bigger range still {image}
the oil long i mentioned yesterday.
slowed down and bounced in the 80s.
reached first target. more targets : 46.45, 46.6, and the final one above 46.78.

47.20ish could sell if considered a htf downward shift.
45.95ish could see buying.
momentum will be key to assess.
it's a little tricky here, this could be a bigger range play so we can see 47s again, but if momentum shows down south, i'm not sure the htf will give too much buying.

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  • #15
  • Aug 29, 2017 1:45pm Aug 29, 2017 1:45pm
Quoting 89ks
{quote} hello, join the forces, post your charts
Here's my post for today...
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  • #16
  • Aug 29, 2017 4:14pm Aug 29, 2017 4:14pm
Quoting 89ks
{quote} the oil long i mentioned yesterday. slowed down and bounced in the 80s. reached first target. more targets : 46.45, 46.6, and the final one above 46.78. 47.20ish could sell if considered a htf downward shift. 45.95ish could see buying. momentum will be key to assess. it's a little tricky here, this could be a bigger range play so we can see 47s again, but if momentum shows down south, i'm not sure the htf will give too much buying. {image}
46.6 to the tick. should trade above 46.2 to have any chance of continuing up.
45.95ish could react, wonder if it could break on a momentum drop. not really interested as of now. eia tomorrow could be interesting.
cheaper prices below 45.4. momentum is key

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  • #17
  • Aug 30, 2017 12:37am Aug 30, 2017 12:37am
gbp aud has been shifting htf momentum since august 2016.
1.6100ish is a significant area of support. in this recent move h4-h8 down to current prices at 1.6200, we already priced more expensive which is a good indication that we could bounce off of 6100ish. worth a shot imo.

will wait for intraday support to establish.
if everything were to set up, prices above 1.6358 possible, given we maintain a lower tf trend.
will update over the next days/weeks

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  • #18
  • Aug 30, 2017 2:26am Aug 30, 2017 2:26am
on trends:

i can't really tell a trend is a trend until i zoom out and see price move from the top left corner to the bottom right on any given time frame. anyone could do that and tell you it's a trend..moving averages, trend lines yadda yadda yadda. it doesn't take much to identify a trend.

way more interesting to know if a trend continues, and to grasp the dynamics of a trend running out of steam, and eventually turn the tides.
since bigger trends consist of smaller trends on smaller timeframes, smaller trends only fulfill the intent of the bigger trend.

there's no manipulation involved in trends of a big enough market. take any bigger momentous down trend making new lows, and a smaller time frame will retrace that trend to then continue the bigger trend until we can't establish lows and do the opposite. then the next bigger time frame will come into play.
or you play the retracing trend. at this point we could be turning the tides.

there's ALWAYS two trends, one retracing the other.
that's really it
  • #19
  • Last Post: Aug 30, 2017 9:37am Aug 30, 2017 9:37am
Quoting 89ks
{quote} 46.6 to the tick. should trade above 46.2 to have any chance of continuing up. 45.95ish could react, wonder if it could break on a momentum drop. not really interested as of now. eia tomorrow could be interesting. cheaper prices below 45.4. momentum is key {image}

the aforementioned 45.96, still struggling in the .20s

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