Support and Resistance – How to Swing Trade Using Support and Resistance
Swing trading using support and resistance is possibly the best way to trade without indicators. This method is so popular and so effective that you will find many bankers and other professional traders around the world trading a variety of markets using nothing more than support and resistance. It is easy to see why they choose swing trading over everything else.
Swing trading using support and resistance is so effective because support and resistance levels are where you stand the best chance of entering into a profitable trade. As price moves up and down in the market, there are certain levels where it meets resistance or support. These levels form due to a variety of reasons, what is important that as a trader if you know where these levels are you can use them to your advantage.
Support levels are perfect places for you to place trades. If price bounces off of a support level, this is a good time for you to enter in the direction of the trend. Price typically bounces from strong support levels and will continue on with the trend. Resistance levels can be used for trade exit. If you know price will likely meet resistance at a certain price level, then exiting or closing out your trade at that time means you will avoid giving back too much to the market by exiting just before price begins to retrace and wipe out your profits.
Swing trading using support and resistance at first may be different to what many traders are used to. You can swing trade a variety of markets with nothing on your chart other than plotting where possible support and resistance levels may be. You may be pleasantly surprised at just how effective it can be.