Important areas on forex market

Important areas on market – These are the areas that you’re looking everyday on your charts. This reminds me of my beginings and the frustrations I was put to: while the price was uncontrollably moving up and down for 20-50 pips the price was on critical area, many news were in the play and everyone was waiting for strong price movement so I’ve opened the position and waited for a buy but the price rashly went to sell, 20 pips in just a few seconds, so I closed the position, and repeated the process for a few times more, and there it was – a loss that I couldn’t wish it to anyone.

Luckily, those times are far behind me, and in next examples I’ll try to explain how to use these areas to your advance.

For the start, I’ve marked the areas that we’re going to discuss about in the picture below (Important Areas On Forex Market) – those are lesser side way trends that last about 5 hours and I use these trends to maximize the profits in times when the most of average traders read the news that confuses them even more. In the picture below I’ve marked the sideway trends that can be also called support and resistance, or you name it as you like, as long as you understand what I’m talking about.

I sincerely hope that you understand what I’m talking about (img 2,3); now in the next picture you can see how i get clear support and resistance, trendlines, and channels by connecting these areas.

How to trade in these areas? Well, for the beginning it’s crucial for you to understand that this is just a one of the indicators that give excellent results when you combine them with the other ones – if you use it in a right way. It’s necessary to have the experience so that you can recognize of these areas in time, and when you do, use the trendlines, Fibonacci, pivot, or any other indicator that will give you additional information which is necessary for better technical analysis.

With those indicators you need to predict a future direction and open the position on lowest points of sideway trend that we’re talking about – in the opposite direction of future trend that you’ve previously plplanned using technical analysis (img: Where Buy or sell).

Few days ago I’ve opened the position thanks to these areas and this is how I’ve planned it all. While looking at the area of sideway trend two days ago, I’ve noticed that there was a strong resistance on that limit; when the price came to that area once again, I’ve expected a forming of a new sideway trend which will turn to a strong support. Thanks to the previous experiences, I could predict and use these areas, so I used my standard TA tools, did the drawing of a trendlines which is displayed in the picture, set the pivots and got an additional confirmation that it’s most likely going to be a long trend. As in the picture, a stronger area wasn’t formed as I’ve expected but knowing these areas gave me an additional confirmation for the analysis. Knowing these areas in this trade started a full analysis which ended up profiting.

If you connect these areas you can get a lot of information and once this kind of area was formed you need to pay attention to it constantly for the future analysis since these areas become a strong supports, resistance, points of trend line, etc. in future price movement. I use these areas for day trading, but it can be successfully used on larger time format scales as well.