So i bought the market because i thought the price had hit the future support line, but i lost, the price went up after hitting another future support line below. How should i know which support line the market gonna brake on, or how to maximize chances?
There is no way to know for sure
Bingo. Maximize chance and reduce risk is the name of the game in my opinion
My 2 cents… Dont enter into a position because you “think” the market is going a certain direction. Sometimes it’s best to wait for confirmation, then enter on a retracement near the s/r level.
Good luck and happy trading to you.
Its an annoying fact of life michael, that you can’t know 100% what price will do.
But you can know 60% what it might do and you must know 100% what you will do about it.
So, where were the mistakes if any in what you did?
Were you wrong to go long? For me, yes, because I only trade with trends, not at reversals, as I find it has a higher probability of profit.
But assuming you accept the risk of a reversal trade, were you too early in going long? I would say Yes and No. If you wanted to minimise your risk of loss, Yes, you acted too early: you could have waited for some confirmation to show on the chart. But confirmation signals can also fail, so it still doesn’t bring you to the 100% certainty level. So maybe you’d be happy to accept the reduced risk anyway and get in, but you’d need to size your position accordingly. On the other hand, if you wanted to reduce your risk of missed gain, then No you were not too early. Sometimes reversals lead into such a fast move that the r:r of the trade becomes unworthwhile.
Finally, were you right to stay out of the second move upward? Yes. Surely you could have gone long at or near or after the second reversal? What stopped you?
Every support acts as a retracement level but there is no certain option, so you have to wait for a retracement before you enter the market.
No you are wrong in telling everybody there is only one way to trade this set-up. TA never says there is only one way to play a particular trade. It is not a mathematical formula that always produces the same answer, it is guidance for the individual trader.
This is even more the case where risk is concerned. Risk is an individual factor. If you are prepared to accept the risk of entering too early you should not need to wait for a retracement.
Thank you all for your responses! It really helped
In my opinion confirmation. You wait until a candle has closed above support , then simply wait for a bullish candle to also close above. The close of a candle/bar is the most important thing to know. I suggest learning about supply and demand.
Support and Resistance is better looked at as areas/zones instead of lines. Due to the fact not all brokers have the same candles and price doesn’t always respect a line.