TRADING USING SUPPORT AND RESISTANCE
09/01/2023, 11:20 WIB
For those of you who have already traded, you must be familiar with support and resistance. Support means the lower limit and Resistance means the upper limit. This support and resistance is related to demand and supply. Demand is demand and supply is supply. If the demand is large then it can limit a price, to make it easier I will give an example. When the gold price drops from $2000 to $1800, and there is a lot of demand in that area, $1800 could be the lowest point. Now this lowest point can become support (lower limit) where there is a lot of demand preventing a breakout in the $1800 area.
Pay attention to the image above, when the price touches the support area where there is a lot of demand. Then the price tends to bounce from that area because there is a lot of demand.
On the other hand, resistance is the upper limit where there is a lot of supply, people want to release their assets at that price. So that the supply is greater than the demand, which causes the price to tend to fall from the resistance area.
This strategy is also very easy to implement, because you only need to pay attention to the point where the bottom and top bounce occurs.