Support and resistance
Prices react at the same zones repeatedly. A broken level often flips its role.
What it is
Support is a zone where buying has repeatedly stopped a fall; resistance is where selling has stopped a rise. They are zones, not exact lines, because orders sit across a range of prices. The more touches and the clearer the reaction, the more significant the level.
When price closes through a level and retests it from the other side, the old support often becomes resistance (and the reverse). That “polarity flip” is the basis of breakout-retest trades.
How to use it
- Draw zones from clear turning points on higher timeframes.
- Prefer levels with several reactions and recent relevance.
- Look for rejection (wicks, engulfing) at the zone for entries.
- Place stops beyond the zone, not inside it.
Common mistakes
- Drawing too many lines until the chart is unreadable.
- Treating a level as exact to the cent.
- Entering at the level without a trigger or a stop.
Practise it in TradeDesk X
The chart’s Levels layer draws previous day high/low/close (PDH, PDL, PDC) and the volume-profile POC/VAH/VAL, which many traders use as automatic support and resistance.
Related lessons
Breakout and retest
Break first, then retest. Waiting for the retest filters many false breakouts.
📊Volume profile: POC, VAH and VAL
Shows how much traded at each price. The busiest price is a magnet; value area edges act as levels.