BTCUSD Learning to understand the support line (educatio inside)

26 cze 2020Let's start with a theory for a better understanding of graphs.

Support is an area on a chart that price has dropped to but struggled to break below, but than subsequently ‘bounces’ sharply from this level.

In theory, support is the price level at which demand (buying power) is strong enough to prevent the price from declining further. The rationale is that, as the price gets closer and closer to support, and becomes cheaper in the process, buyers see a better deal, and are more likely to buy. Sellers become less likely to sell, since they are getting a worse deal. In that scenario, demand (buyers) will overcome supply (sellers) and that will prohibit price from falling below support.

It is also possible to take into account the direction of the trend in attention - in this case it is upward. Consequently - a high probability of price increases.

❗REMEMBER: Even when all factors indicate a price increase or decline, everything can happen the other way around. Therefore, when trading, you should always consider RISK MANAGEMENT - install SL!

Traders, if you liked this idea or have your opinion on it, write in the comments. I will be glad👩‍💻